Coronavirus in Chile ECONOMY

Unemployment in Greater Santiago at Highest Point in 20 Years

SANTIAGO – The impact of the coronavirus in Chile is not only felt in hospitals and clinics. The economy and job market has been hit hard, a recent study shows. Unemployment numbers in the Greater Santiago region have skyrocketed to a record high.

Unemployment in Greater Santiago, where approximately six million people live and a large part of the country’s economy is concentrated, reached 15.6 percent in March 2020. According to a study from the Microdata Center of the University of Chile, the number is the result of the crisis that the coronavirus outbreak has caused in Chile.

The number for March is the highest recorded in the last 20 years. Compared with March 2019, the unemployment rate has more than doubled. This 15.6 percent is the equivalent of nearly 470,000 unemployed people. According to the study, entrepreneurs were hit hardest: self-employment fell by 24.9 percent.

The two sectors that so far have received the hardest blows because of the coronavirus are trade and construction. In the trade sector, employment fell by 23.3 percent while in construction employment dropped 22 percent. The social services, transportation, and communication sectors are also suffering.

Congress Wrestles With Economic Effects Of The Pandemic

Over Half a Million Contracts Suspended

According to a report presented by Minister of Labor María José Zaldívar, over 90,000 companies have applied for relief under the Employment Protection Act since the coronavirus outbreak started. The law allows companies to suspend contracts or reduce working hours, while employees can benefit from insurance regulations from the government.

All told, 92,204 companies, one third of them with 200 workers or more, have suspended 555,002 contracts to date. According to Zaldívar, the law is “an effective tool to take charge of unemployment.” Nearly 68 percent of the suspended contracts involve workers in the Metropolitan region.

Side Effects of the Crisis

The uncertainty and crisis in the Chilean job market have side effects that should worry health authorities. Now that having a job and a stable income is even more of a privilege, workers are taking more risks to appear at work. Together with the University of Chile, the Medical Association presented a worrying report showing that more than 15 percent of workers in Chile who tested positive on Covid-19 continue to go to work.

The results, obtained after monitoring nearly 40,000 Chileans for over six weeks, show that 24 percent of the people suspected of having the virus still appear at work, and nearly 18 percent continue to take public transport.

Experts reiterated the importance of social security and access to medical licenses for those who suspect they carry the virus. As investigators warn, a return to a “new normal” will only be further away if possible carriers of the virus continue on with their daily routine and mix and merge in public spaces.

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