Employment holds steady in Latin America and the Caribbean, but informality and inequality persist

Labour Overview 2025

Employment holds steady in Latin America and the Caribbean, but informality and inequality persist

In its newly released Labour Overview 2025, the ILO finds that despite gains, structural gaps and informality persist as changes in the world of work demand attention.

11 December 2025

LIMA (ILO News) -The Latin America and the Caribbean region saw a moderate recovery in employment across the region. According to the newly released Labour Overview 2025 for Latin America and the Caribbean from the International Labour Organization (ILO). At the same time, the report cautions that this progress coexists with persistent informality and inequality, amid ongoing transformations in the world of work that require urgent policy responses.

According to the report, in the first half of 2025 the average labour force participation rate in the region remained close to 63 per cent, while the employment rate reached nearly 60 per cent. The unemployment rate continued to decline, standing at around 6 per cent - one of the lowest in the past 15 years. These figures suggest that the number of people actively working or looking for work has remained stable compared to the previous year, and that more people managed to enter the labour market.

Informality remains a defining feature of the region's labour landscape. While it declined slightly to 46.7 per cent in the first half of 2025, nearly one in every two employed persons still works under informal conditions.

The region cannot be content with averages that seem positive. We need active policies that promote decent work, equality and protection
Ana Virginia Moreira Gomes, ILO Regional Director for Latin America and the Caribbean

"The region cannot be content with averages that seem positive. We need active policies that promote decent work, equality and protection," said Ana Virginia Moreira Gomes, ILO Regional Director for Latin America and the Caribbean. "The ILO remains committed to supporting countries on this path, especially in a world of work that is evolving rapidly."

Persistent gaps affect women and young people in particular. Although women's labour market performance has improved more than men's in recent years, it still lags behind. The male labour force participation and employment rates are both 22 percentage points higher than those of women. Women's unemployment rate is two percentage points higher than men's. Youth (aged 15-24) face an unemployment rate nearly three times higher than that of adults. Informality affects 56 per cent of young workers, compared to 43 per cent of adults.

Behind these statistics are millions of real-life stories. Each percentage point reflects people working, seeking jobs or excluded from the labour market. Access to decent work impacts not only income, but also health, education, wellbeing, and development opportunities across society. The ILO stresses that recovery must go beyond numbers, with a focus on formalization and decent work as the cornerstone of a sustainable development that ensures social justice.

The report also highlights wide disparities across countries, as well as by gender, age, and economic sector. Women and youth continue to be the most affected by informality, unemployment and precarious work.

In addition, the report explores how the world of work is changing, with special attention to digital platform work. One finding shows that, among platform workers, higher education levels are associated with higher incomes.

"Employment is transforming. While some indicators are improving, we need to look below the surface. Data reveal significant disparities across countries and population groups. New forms of work demand updated policies and regulatory frameworks," said Gerson Martínez, labour economist and lead author of the report.

The Labour Overview 2025 of this report comes shortly after the 20th ILO American Regional Meeting, held in October 2025, where regional authorities reaffirmed their commitment - through the Punta Cana Declaration - to decent work, formalization and addressing structural inequalities.

The publication provides data by country, age, sex and economic sector, offering a vital tool for policymakers, employers, workers and journalists focused on the present and future of employment in Latin America and the Caribbean.

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