He Unemployment in Ecuador has dropped statistically significantly from 424,826 unemployed citizens in the first quarter of 2022 to 324,904 in the first quarter of 2023. The figures represent a drop from 5% to 3.8%.

Meanwhile, underemployment also decreased statistically significantly, starting from 1,908,839 to 1,701,796, that is, it fell from 22.6% to 20% in the same period.

In the meantime, adequate employment (at least 40 hours per week and earning at least the basic wage) in Ecuador was 2,967,972 in the first quarter of 2023 (January to March). The figure is better compared to the first quarter of 2022 (2,773,750), so the indicator rises from 32.9% in 2022 to 34.9% in 2023. However, this is not a statistically significant difference.

Three positive data, showing the recovery of the labor market, were reported by the National Institute of Statistics and Censuses (INEC) in its quarterly report from January to March 2023.

Despite the better performance indicators, the INEC survey also reveals that there is a higher level of informality in the market. So, according to INEC, In the first quarter of 2023, the informal sector accounted for 53.5%, while in the same period of the previous year it was 51.1%. informal people.

According to INEC, employment in informal sector It is operationally defined as a group of people working in production units with less than 100 workers who they do not have a single register of taxpayers (RUC). Meanwhile, employment in the formal sector is defined as people working in institutions that have RUC.

Regarding the latest INEC data, consultant Adecco says that while some labor indicators have improved in the past year in Ecuador, it is important to consider other qualitative aspects such as informality in employment, the gender gap and the inclusion gap. “There are still relevant gaps in terms of wages and job quality, which may limit some people’s ability to access well-paid jobs with good working conditions,” explains Sebastián Lima, National Director of Quality and Services at Adecco Ecuador.

This is important information that should be taken into account because “informal work is often associated with insecure employment, lack of social protection and lower incomes compared to formal work,” the Adecca expert points out.

This increase in The informality of work can be caused by several factors, such as lack of formal employment, lack of labor market regulation and poor working conditions in formal sectors.

In order to solve this challenge, Adecco believes that it is necessary to implement policies that promote the formalization of work and improve working conditions in the informal sector. This includes supporting SMEs to formalize them.