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Sunday, April 2, 2023

Unemployment rises, how much does the dollar have to do with it?

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Meanwhile he employment remained stable in year-on-year terms, the Activity rate it reached 63%, motivated precisely because there are more people looking for work than available positions.

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The price of dollar and two of its consequences, the delay of the exchange rate and the difference with the values ​​of Argentinathreatens to complicate the outlook in the medium term if the current situation is not reversed.

From the business sector, one of the concerns is not so much to increase jobs as to sustain them. Several sectors have been alerting since last December, even before the US currency pierced the 38-peso floor, as happened in some days in January, that the effects of the exchange rate delay on the competitiveness sooner or later they will put jobs at risk.

The decline in the dollar in real terms and in terms relative to the countries with which Uruguay trades or competes commercially makes it difficult for sectors that export or compete in the domestic market with imported products keep jobs.

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The US currency rose 0.55% in February, but accumulates a fall of 2.94% so far this year. In 2022, this depreciation was 10.65% accumulated.

In the latest quarterly survey of the National Chamber of Commerce and Services (CNCS) 16% of merchants Montevideo He said that he expects to increase his workforce, but 6% expect to reduce it. In the interior of Uruguay the figures are 12 and 7% respectively.

Although in most cases, the merchants plan to maintain the jobs, this maintenance will not be enough to cover the supply of laborwhich prompted a rise in the unemployment rate in the first month of the year.

Added to this is the exchange difference with Argentina, which, although it has a full impact on coastal trade, also has its repercussions on consumption in general and in Montevideo.

In addition, the overall spending of Argentine tourists in Uruguay decreased, even though the number of visitors has remained at good levels, with its impact on the services area in the middle of the season, one of the sectors with the worst unemployment rates.

Source: Ambito

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