Three out of 10 college-educated workers are part-time, why is that?

About 5 million Peruvians lived in metropolitan Lima. employees until the end of September, indicates the National Institute of Statistics and Informatics (INEI). However, not all of them had suitable jobs.

In total, in the capital, where a third of the country’s population is concentrated, 2 million 63 thousand people have been underemployed over the past three months, but what does this mean?

“For an employee to be considered part-time There are two possibilities: the first is that the income received by the worker is not sufficient to cover the family’s food basket (…) And the second condition is that the worker works less than 35 hours a week, that he or she cannot complete a full shift for involuntary reasons,” said Oscar Chavez, head of the Institute for Economics and Business Development (IEDEP) of the Lima Chamber of Commerce (CCL).

Who suffered the most?

Although the Peruvian labor market surpassed pre-pandemic levels in the first half of the year, underemployment affected 44 out of every 100 workers across the country.

In at least Lima, over 38% are part-time, and it is estimated that 3 out of 10 college-educated Peruvians are in this condition. Economist Miguel Jaramillo points out that this is because employment has not grown in Business which require more qualified personnel.

“Decent employment in companies with 11 to 50 employees has fallen by 18% since 2019, and in companies with more than 51 employees, which pay the highest salaries, by 12%. the quality of work, the conclusion is unequivocal, we live worse than before the pandemic”

Development Research Network (Redes) Economist Paola del Carpio added that this problem is due to the fact that the training of workers with research bosses don’t necessarily cover what demand for labor requires.

“Many people go to universities with a huge margin for technical specialists, very few people go to technical education and many people go to universities and often to poor quality universities. There are studies that show that the probability of part-time employment when leaving low-quality universities is much higher,” he said.

For his part, the representative of the CCL specified that about 280,000 people join the economically active population every year, that is, an average of 7,500 people a day join labor market.

“About 280,000 people are included in the economically active population every year, and an average of 7,500 people a day are included in the labor market. If job creation does not keep pace with this increase in the economically active population, then young people are obviously found in the dilemma “I am unemployed or I accept a job even if it brings low income”, so they accept or accept the condition of part-time employment”

Underemployment does not only affect tertiary-educated workers, as INEI indicates that 56 out of every 100 people with secondary education suffer from underemployment, earning 400 soles less than salary average for Lima.

This group of employees earn an average of sol 1,334 per month, while according to Phase Consultores, at least sol 1,600 is needed to cover the basic family basket.

What can be done to improve this situation?

“Peruvians are in part-time positions mainly because there are no other opportunities. We need our economy to develop more actively through sectoral policies, and not grow at the expense of services or trade, which currently lead to low incomes, which not only give subsidies, but also invest in training and human capital,” commented Antonio Castillo, manager of the Economic and Social Research Institute of the National Society of Industry (SNI).

In addition, CCL’s Chavez indicates that more private investment to create formal jobs as it increases productive capacity.

Although the prospects are bleak in the capital, the situation is even worse in the regions, because informality, that is, employment in unregistered companies, without insurance, vacations and benefits, is higher than the national average (76%).

“An informal worker is one who does not have labor rights, access to social security, vacation, old age pension,” added CCL’s Oscar Chavez.

Until the first half of the year, SNI warns that in regions such as Cajamarca, San Martin, Amazonas, Huancavelica, Huanuco and Ayacucho, informality exceeds 88%, meaning almost nine out of 10 people are informal.