Unemployment worsened in 25 cities in the interior

At the end of the third quarter of 2023, employment in Peru did not show signs of recovery compared to the same period of the previous year; quite the contrary, The situation worsened in 25 cities. Only in Metropolitan Lima did unemployment decrease.

In detail, Moquegua registered the highest unemployment rate, going from 6.6% last year to 11.4%, marking the most pronounced increase during the aforementioned period, according to INEI figures analyzed by ComexPeru.

The cities of Cajamarca, with 9.2% (+4 percentage points), and Puno, with 8.5% (+4.5 percentage points), were the ones that followed (see infographic). The figures for Chiclayo (8.4%), Huancavelica (8.2%), Arequipa (7.9%), Chimbote (7.7%) and Ica (7.6%) are also surprising.

In the case of Metropolitan Lima, the unemployment level stood at 6.7%, after falling one percentage point from 7.7%.

Affected by the recession

The former vice minister of Employment Fernando Cuadros attributes the increase in unemployment in the regions to the prolonged period of recession that the country is going through, with three consecutive quarters of fall in the GDP at the national level. “This problem of falling production of goods and services in the country is becoming more acute and this obviously results in less generation of employment in general and, above all, quality formal employment,” he mentions.

The economist also explains that, in the case of cities like Moquegua and Puno, which top the list, the increase in unemployment is linked to the decline in key sectors such as agriculture, manufacturing and construction.

In fact, the report prepared by ComexPerú indicates that 2.8 million jobs were registered in the rural sector, that is, 735,049 fewer than in the same quarter of 2022. The majority is explained by the decrease in the agricultural sector, where 2 million 103,508 jobs, equivalent to a reduction of more than 530,800 jobs. A decline in employment was also observed in the public administration and in the construction sector.

Regarding the situation in Metropolitan Lima, Cuadros explains that, although the unemployment rate has decreased, It is important to consider the possible increase in precarious employment and self-employment. It also highlights the growing labor inactivity after the health crisis, which could contribute to an artificial reduction in the unemployment rate.

“In the post-pandemic, work inactivity has grown. That is, people who left the job market and who did not manage to find work and who have already stopped looking for one,” he says.

The data

Impact. At the national level, unemployment affected 930,450 people. This is 141,908 additional unemployed people than in the third quarter of last year, according to the INEI.