Unemployment Issue in Chile

Abstract

This paper will outline the unemployment issue in Chile and as a World Bank employee; it will facilitate the research requested by management.

Chile is one of South America's most established and flourishing countries. It has been protected against government impartiality because of the reign of General Augusto Pinochet.

The unemployment rate in Chile is at 8.7% as stated in CIA World Fact book (August 16, 2011). The country might be prosperous because of the high price the international market has placed on his copper; it is not protected from the unemployment epidemic. Chile has a market-oriented economy characterized by a high level of foreign trade and a reputation for strong financial institutions and sound policy that have given it the strongest sovereign bond rating in South America. Exports account for more than one-fourth of GDP, with commodities making up some three-quarters of total exports. Copper alone provides one-third of government revenue. During the early 1990s, Chile's reputation as a role model for economic reform was strengthened when the democratic government of Patricio AYLWIN - which took over from the military in 1990 - deepened the economic reform initiated by the military government. (CIA fact book)

Statistics Table

Labor Force:

7.58 million (2010 est.)

Labor Force by Occupation:

agriculture: 13.2%

industry: 23%

services: 63.9% (2005)

Unemployment Rate:

8.7% (2010 est.) country comparison to the world: 100

9.6% (2009 est.)

Population below Poverty line: 11.5%

Within the past forty years there have been three episodes of serious recession where unemployment increased sharply: 1973-1975, 1980-1981 and 1998-1999. During each episode, the annual unemployment rate increased by 50 percent or more and average unemployment duration lengthened noticeably. For many, increased unemployment caused large decreases in labor market earnings and decreases in family well being.

Chilean workers are protected by the a few programs that were implanted to provide job security and job stability. The unemployment insurance which was established in 1937, they benefit from training programs and temporary agencies where one can go and seek employment until a full time position is opened; Family allowances and medical assistance are also available for