How did late-20th-century economic reforms affect unemployment in Latin America?

In the late 20th century, Latin American countries increasingly adopted neoliberal economic policies, which included reducing trade barriers, privatizing state-owned enterprises, and encouraging private investment. While these reforms aimed to strengthen the private sector and foster economic growth, their impact on the labor market was significant and often negative in the short term.1

Specifically, the drive to increase competitiveness in capitalist markets contributed to record levels of formal unemployment across many countries in the region. As formal job opportunities struggled to keep pace with these structural shifts, there was a widespread rise in subcontracting, where many workers—particularly women—were forced to labor for subsistence income. These economic reorientations created profound social challenges, as the transition to more open, market-driven economies often exacerbated existing inequalities and left vulnerable populations, such as rural peasants, facing increased economic hardship.1