$Unique_ID{COW03830} $Pretitle{297} $Title{Uruguay Chapter 4B. Population Problems} $Subtitle{} $Author{The Director Foreign Area Studies} $Affiliation{HQ, Department of the Army} $Subject{percent labor sector employment unemployment population workers relatively available census} $Date{1971} $Log{Table 2.*0383001.tab Table 3.*0383002.tab Table 4.*0383003.tab } Country: Uruguay Book: Area Handbook for Uruguay Author: The Director Foreign Area Studies Affiliation: HQ, Department of the Army Date: 1971 Chapter 4B. Population Problems In 1968 an independent Montevideo newspaper set forth briefly a listing of the country's major demographic problems. Among these it mentioned a sparse population with a low and declining birth rate, sagging immigration, and a wave of emigration of young people since World War II. It also observed that in this highly urbanized country there were too few people to provide a market large enough to support a healthy and diversified industrial establishment. The highest longevity rate in Latin America, coupled with the early retirement made possible by the generous public welfare system and the increasing proportion of young people remaining longer in the educational system, leave relatively few adults in the productive age brackets to support the remainder of the population. Structure and Dynamics of the Labor Force Age and Sex Composition A sampling from the 1963 population census resulted in the conclusion that the economically active population included about 39.2 percent of the total. Some 58.9 percent of the males and 19.6 percent of the females were either employed or seeking employment (see table 2). Because there has never been a comprehensive labor force census and the 1963 population census was the first since 1908, data showing age and sex dynamics of the labor force are not available. The percentage of Uruguay's population included in its labor force in 1963 was fifth highest among the twenty-two independent nations of the Western Hemisphere. Some qualifying statements, however, are in order. During the late 1960s the labor force included a minimum of 12 percent unemployed and a considerable number of underemployed. It also included many government employees with work weeks of thirty hours or less and seasonal and migratory workers employed during half a year or less. Overall, the reported employment rate represented an increase from an estimated 34 percent in 1940. The country's low birth rate, high rate of retention of young people in schools, and provision for early retirement combined to maximize the proportion of the labor force in the middle years of life. In 1963 nearly half (448,220 out of a total of 1,015,500) were between the ages of thirty and forty-nine. Employment of juveniles and adolescents was at about the average for Latin America. It should be noted, however, that some secondary school and most university students held part-time jobs while continuing their educations. Early retirement is reflected in the 1963 figures by the drop from the 54.6 percent of those fifty to fifty-four years old who were in the labor force to the 30.3 percent of those sixty to sixty-four, in a country with an average longevity of about seventy-one years. [See Table 2.: Composition of Economically Active Uruguayan Population, by Sex and Age Group, 1963 (in percent)] The highest rate of employment of women in 1963 was for those between the ages of twenty and twenty-four, but it remained high for those between twenty-five and twenty-nine years. Since women most commonly abandon their jobs because of marriage and the bearing of children, these figures suggest that Uruguayan women do not marry young, a conclusion consistent with the fact that most of them are well-educated urban dwellers. In most societies, it is young women in this category who are most likely to continue working and to defer marriage until they reach full maturity. Because the comparative data from the 1961 and 1966 agricultural censuses are relatively recent, they are useful, although they represent samplings of an economic sector constituting less than 18 percent of the total labor force. Between the two recent agricultural census counts, employment on farms and ranches of more than about 2.5 acres (1 hectare) declined about 9.1 percent. The 146,147 males employed in 1966 were 91.4 percent of the number who had been working in 1961. The 45,417 females were 89.3 percent. Both men and women were migrating from country to town, but it was the women who were moving faster. Composition by Economic Sector and Occupational Category The most recently available firm data on composition of the labor force by economic sector, based on a 5-percent sample of the 1963 population census, as analyzed by the International Labor Office, give a total of 957,100 (see table 3). Data by sex for economic sectors were not available. By type of employment, however, females made up 22.3 percent of the employers and self-employed, 25.7 percent of the salaried employees and wage earners, and 13.9 percent of the family workers. This count shows 235,800 females, or nearly 25 percent of the total, as members of the 1963 labor force. These figures, the most complete ones available with respect to employment by economic sector, are deficient in the sense that they do not include those individuals seeking employment for the first time and members of the armed forces. Such persons are included in other International Labor Office data based also on the 1963 census, which report a 1963 working force of 1,015,500 (see table 4). A characteristic of the economically active population in 1963 was the small size, relatively the smallest in South America, of the unpaid-family-worker category, a reflection of the high degree of urbanization of the country. Since rural boys are permitted to work in the fields at the age of twelve and Latin American child labor is primarily a rural and male phenomenon, most of this relatively small group were probably teenage boys. Because there was no census between 1908 and 1963, there is a shortage of material on the extent of the growth of the labor force. One series of statistical estimates, expressed in percentages for the years 1995, 1961, and 1965, reported those engaged in agricultural, pastoral, and related pursuits in the three years to have been 26.5, 22.4, and 18.8 percent of the total respectively, with the pastoral representing an average of three-fifths of employment in the sector. Industry employed 20.4, 22.7, and 23.1 percent, respectively. Construction accounted for 5.0, 4.2, and 3.7 percent. Trade, service, and the unemployed included the remaining 48.0, 50.9, and 54.3 percent of the labor force. These data are estimates only and inconsistent in minor detail with some other figures quoted. [See Table 3.: Employment in Uruguay, by Economic Sector and Type, 1963] Occupational Skills The quality of occupational skills appears to bear a direct relation to the degree of education achieved by the personnel in the economic sector involved. Output in terms of the per capita portion of the gross domestic output at current factor costs by economic sector was lowest in agriculture and highest in services. There were a great many of the poorest people engaged in the services sector, but it was also in the services sector that most of the highest incomes were found. In 1969 it was estimated that rural productivity averaged about 20 percent below that of the economy as a whole, although productivity on large pastoral operations was reported high in relation to that on farms and ranches below about 125 acres (50 hectares) in size. Skills are relatively the lowest in the sheep country north of the Rio Negro where the population is sparse and there is relatively the highest concentration of Negro and Indian mixtures. This is the least developed part of the country and, because the population is so scattered, schools are few and education relatively limited. Children twelve to fifteen years of age, too young to have acquired significant skills, are more likely to be employed in the fields than in the schoolroom. [See Table 4.: Distribution of Uruguayan Labor Force by Occupation, 1963] South of the Rio Negro, in the cattle country, there is a heavy concentration of descendants of the earlier settlers. In this area, and along the bank of the Rio Uruguay, a greater frequency of towns and the greater density of the rural population permit a readier access to schools and acquisition of skills. This is true to a still greater degree in the agricultural lowlands, where second- and third-generation descendants of immigrants are found. Productivity and the level of skills are relatively low in the industrial sector of Montevideo and the few other localities that support industrial establishments. Most of the plants in the 1960s were reported to be using outmoded equipment and layouts, and the pronounced preference of primary school graduates for academic rather than technical or vocational secondary educations made employers place considerable reliance on on-the-job training. In addition, the dropout rate was significantly higher in technical and vocational than in agricultural schools (see ch. 8, Education). The proportion of workers in the services sector was much too high for the welfare of the economy, but the level of skills was also high. Office workers were well trained. Physicians, lawyers, bankers, and economists were highly competent. Because of the excessive number of public servants, their productivity was low, but their level of capability was generally high. In the 1960s the chief dilemma of the country's economy was that the level of skills among manual workers was relatively low but that at the same time the number of skilled white-collar and professional people exceeded the ability of the economy to absorb them. As early as 1961 it had been remarked that the college-graduate market was supersaturated. Unemployment There appears to have been a sharp rise in unemployment in the early 1960s. No official figures were available, but in 1961 an estimated 8.6 percent were unemployed, and this percentage was reported to have increased to 12.3 in 1963. Organized labor claimed that the 1963 figure, derived from a sampling of the 1963 population census, was much too low with respect to the industrial sector. The actual number of people out of work is largely a guessing game. One 1963 evaluation from a private source reported the total at anywhere from 12.5 percent to 25 percent of the labor force. In 1964 a United States agency suggested a range of from 12 to 20 percent. During the mid-1960s the figure of 12 percent was most frequently quoted for the nation as a whole. That figure did not, however, include the redundant public employment, which an austerity government was attempting to reduce. The partial price-wage freeze instituted by the government in 1968, coupled with its efforts to reduce the number of public employees, in 1970 had presumably increased the proportion of the labor force drawing unemployment compensation. The unemployment rate was believed to be much lower in the countryside, where rates as low as 4 percent were mentioned. In that sector, however, underemployment was prevalent, and the unemployed frequently left for the cities and towns, with the effect of easing the lack of work opportunity in the countryside and worsening it in the more heavily populated areas. With the institution of the austerity program that followed the abandonment of the colegiado (collegiate executive-see Glossary) in 1967, unemployment apparently moved sharply upward. In late 1968 it was reported that 31.4 percent of the textile workers were unemployed and that this level was being approached in other industrial sectors. The government, however, was acutely aware of its unemployment problem and attempted to deal with it in a variety of ways. There was a liberal unemployment compensation program, and provisions for early retirement were in part designed to make jobs available for younger workers (see ch. 7, Living Conditions; ch. 20, Labor Relations and Organization). Many white- and blue-collar workers, particularly government servants, had short workweeks. This was presumably with the intent of making more jobs available, but the intent was frustrated to the extent that many people with relatively few work hours held second, and even third, jobs. Since 1967, however the government had instituted a variety of measures to reduce redundant public employment, both in the civil service and in unprofitable government-operated business enterprises (see ch. 13, Political Dynamics). The construction industry was in a virtual stagnation and its personnel were out of work from the mid-1960s to late in the 1960s when a substantial public housing program was initiated. On farms where the head of the family was the owner or operator of the property, outright unemployment was as low as 4 percent. There was, however, considerable labor redundance in the sense that four members of a family might till fields that could be worked as effectively by two. Landless farmworkers who made up at least half of all farmworkers may work only half of the year, and it is estimated that some 4 percent of the migrant hands are surplus even in the busy months of March, April, and May. In the eyes of this group, the solution of their problem is acquisition of land. It has become a cause celebre. This has been particularly evident in the case of the sugar workers of Artigas Department who have three times, most recently in 1968, engaged in protest marches to Montevideo demanding distribution to them of about 74,000 acres (30,000 hectares) of sugar land that they claim to be lying idle (see ch. 20, Labor Relations and Organization). In 1970 it was impossible to find an exact unemployment figure. Outright unemployment in rural areas probably was only about 4 percent, but this included employment through parts of the year so brief as to encourage a flight to Montevideo. One analyst speculated that the wave of strikes in 1968 was motivated principally by fear of income loss through inflation, whereas the strikes of 1969 tended to reflect a fear of higher unemployment. Overall, in the late 1960s, 12 percent had become a kind of universally accepted figure for Uruguayans out of work. It was a speculative figure, however, because of the incompleteness of census data and because so many people, agricultural and construction workers for the most part, worked only a few months during the year. Uruguay is one of the few countries of the world for which the 1969 Yearbook of Labor Statistics, issued by the International Labor Office, was unable to furnish data. It has been argued that the early retirement encouraged by the country's advanced welfare legislation reduces unemployment by making more employment available to young people. This philosophy has considerable acceptance within the country but seems vulnerable to the opposite position that jobs create jobs in a kind of multiplier process. The progressive mechanization of agricultural processes on the larger commercial farms and the slow growth of the urban industrial sector of the economy have contributed to the growth of unemployment. Young unemployed people leaving the land have found no job offerings in urban areas. The trouble, during postwar years, is that the industrial sector has not been growing at a rate sufficient to absorb the influx of workers from the countryside made surplus by mechanization and other improvements in agricultural and pastoral productive practices. Advanced labor legislation, including such incentives as minimum industrial wages and guarantees of early retirement on substantial pensions, and a high level of employment in the public sector, coupled with a generous unemployment compensation program, have been palliatives inherited from the Battle political regime. Unemployment compensation is available to all able-bodied persons over the age of fifteen who have lived two or more years in the country and who participate in the state pension fund for industry and commerce. They are not eligible, however, if the unemployment is the consequence of strikes, misdemeanors, voluntary separation from employment, or certain other causes. Compensation is limited to 180 days in the calendar year, but the pension fund board may extend the limit by a further 60 days if the conditions of a particular occupation require it. The program is funded from state pension fund contributions.