Unemployment Lessons From Colombia

Colombia's urban unemployment rate, traditionally the main measurement of joblessness in the country, declined in November as faster economic growth appears to be fueling job creation. Colombia's urban unemployment rate dipped to 10.6% in November from 21.1% a year ago, the national statistics institute, known as DANE, said Wednesday. The decline extends a trend of lower unemployment readings in the country's biggest cities over the last few months. In a nationwide survey, which economists say produces a less exact indicator of the job market, unemployment stood at 10.8% from 11.1% a year earlier. Some economists have warned that devastating rains over the last weeks could generate a temporary spike in unemployment as more than two million people have been affected by the downpours. Colombia's stubbornly high unemployment rate represents one of the top economic challenges for President Juan Manuel Santos, who has pledged to create 2.5 million jobs in the next five years by easing labor laws and making it cheaper for small companies to hire workers that are starting their first jobs. The decrease in the urban unemployment rate, based on a survey of 13 metropolitan areas, comes amid faster economic growth this year. The Colombian economy expanded by 3.6% in the third quarter. The figure disappointed economists and government officials, with the central bank lowering its growth estimate to 4% for all of 2010. The projected growth, however, compares favorably to 2009 when Colombia's DP expanded a tepid 0.8%. Colombia's unemployment rate is considered one of the highest in Latin America. The Santos administration is engaging in an ambitious economic reform package, which will need the approval of Congress, in a bid to boost economic growth and job creation.