The size of the informal sector is a major determinant of how quickly — or slowly — economies can grow and provide economic opportunities for their inhabitants. In Latin America, unregistered work is an important source of employment for millions of people. But many people struggle to make the transition to the formal sector because of a lack of educational opportunity.

Moving Out of the Informal Sector

Learning and skills development are essential components of any transition to the formal economy, as they improve people’s skills and consequently their employability.

Currently, in Latin America, the graduation rate at the secondary level stands at approximately 60%, a tragedy that has been exponential during the pandemic.

The combination of low levels of schooling in some countries, mainly in secondary education, with limited training possibilities, results in a large share of the population only being able to access low-skilled jobs, which are constantly threatened by automation. Nowadays, more than 150 million workers are informal throughout Latin America.

Given this scenario, quality education and employment needs to be high on the public policy agenda in Latin America and elsewhere. My book, No Work: Employment in Latin America in the Context of Poverty, Education, Technology and the Pandemic, explores how to build any education system to provide opportunities to the half of Latin Americans who today lack formal and quality jobs.

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