With 76 percent of its population under the age of 39, the Nicaraguan workforce is a young and dynamic population. However, unemployment for educated youth is around 30%, three times higher than average youth unemployment and four times higher than general unemployment. This scenario is not very different from the rest of the developing countries.
Like any other market, the labor market is based on supply, in other words, employees; and demand, the companies. Labor market in developing counties is characterized by a high level of supply, but since investment rates are low, companies do not have enough jobs positions to withstand this amount of supply. The informal sector, underage work, and a widespread of self-employment and many unpaid individuals working in family enterprises, just aggravate the condition. But the main labor market issue is not how to get people to work but rather how to get people good jobs. What does that mean? Good jobs can be defined as jobs with high returns to education, good pay and working conditions. But how to create more and better jobs?
First, foreign investment as a means of generating new opportunities for both the employer and the employee in the country. The strong economic growth in the long term, the promotion of productive transformation through technology and the contribution to more and better jobs are the key benefits sought for economic and social development. Labor and social security and stability, in addition to good government relations with the private sector increasingly allow more investors set their sights in low income countries, and invest large sums of capital. These are factors that should be promoted by the central governments in order to to guarantee macroeconomic development.
Secondly, education is the most important factor when choosing between a formal or informal job. Education allows every human being to acquire the knowledge, skills, attitudes and values necessary to shape a sustainable future, is an essential tool for achieving sustainable development; thus, providing education, employment and empowerment for young people are key factors in achieving global progress. Governments need to strengthen access to primary education, provide training and improve access to job opportunities for young professionals.
Labor markets that promote the creation of more and better jobs are also needed to guarantee sustainable development, and ensure that the benefits are widely distributed. Promoting labor and social security and good government relations with the private enterprise, in addition to supporting technical and vocational education and training systems are also crucial to an effective implementation of poverty reduction strategies. According to a recent survey from the Labor Market Profile 2011 estimated that, in spite of high levels of unemployment, informal jobs, poverty, and violence, more than 62% of young people are optimistic about their future. What are we doing to embrace these futures?