Almost half of Latin American households earn less than before the pandemic, according to a survey by the World Bank and UNDP

Latin America and the Caribbean emerge from the COVID-19 crisis with a weakened economy, lower incomes in almost half of households and twice the food insecurity, says a survey by the World Bank and the United Nations Program for the Development (UNDP).

The situation has improved as countries relaxed containment measures and vaccination campaigns advanced, but the regional employment rate is 11 percentage points lower than the pre-pandemic, with 62% of the working-age population currently employed, points out.

The employment rate with respect to pre-pandemic levels has only risen in Guatemala, Nicaragua and El Salvador, but at the cost of a deterioration in the labor market, with more informality and fewer hours worked.

Almost one in four people employed before the pandemic say they no longer work. The country with the most job loss is Haiti, followed by Colombia (35%).

The loss of employment has had a direct impact on families as close to half of the households have not recovered their pre-pandemic income level.

Income appears to be rising in Guatemala, Honduras, and El Salvador, compared to mid-2020, but in Bolivia, Paraguay, Ecuador, and Colombia, more than 60% of households “have not yet shown signs of recovery.” And this despite government subsidies and emergency aid “that together benefit 46% of households in the region,” adds the World Bank.

During the pandemic, food insecurity nearly doubled, especially in countries with the highest inequality and poverty.

The pandemic evidenced pre-existing inequalities, says Luis Felipe López-Calva, UNDP regional director for Latin America and the Caribbean, who assures that “this survey allows us to take the pulse of the region and propose solutions based on evidence.”

Access to health services has returned to pre-pandemic levels, but the level of vaccination in the Caribbean is of concern. Finally, the survey highlights that the pandemic has increased digital transactions, both mobile banking and electronic commerce.

To emerge stronger from the crisis, the region must carry out reforms “already known but pending,” estimates Carlos Felipe Jaramillo, World Bank Vice President for Latin America and the Caribbean.

Among these reforms, Jaramillo lists: improving the quality of education, facilitating private investment to generate employment, investing in renewable energies and allocating funds for urban mobility (air quality, replacement of the public and private vehicle fleet). (I)