Panama has received welcome news on the labor front: the national unemployment rate has fallen from 10.4% to 8.5%, with female unemployment dropping from 13.2% to 10.4%. Yet behind the improving headline figures lies a deeper challenge — nearly 145,000 people have lost full employment, and more than 413,000 Panamanians work at least 40 hours a week while earning less than the minimum wage.
What Happened
According to an opinion piece published by La Prensa, Panama’s latest employment data shows meaningful progress in reducing joblessness. The overall unemployment rate declined from 10.4% to 8.5%, and unemployment among women fell from 13.2% to 10.4%.
However, the analysis warns that these gains should not obscure the underlying reality of the labor market. Close to 145,000 people no longer hold full employment, while over 413,000 workers put in at least 40 hours per week yet take home income below the legal minimum wage. The piece argues that finding a job is necessary, but being able to live with dignity from that job is fundamental.
Background
The La Prensa column argues that employment — and specifically quality employment — should be a national obsession, demanding coordinated effort from the government, businesses, workers, and the education system.
The reasoning is economic as much as social. More formal, better-paid employment produces a triple benefit: greater well-being for families, higher revenues for the Treasury, and increased contributions to sustain Panama’s pension system. In an economy where informal work and underemployment have long been structural concerns, the distinction between having a job and having a decent job is critical for public policy.
Panama has historically posted some of the strongest growth rates in Latin America, but labor market indicators have not always kept pace with headline economic expansion. The gap between the unemployment rate and measures of underemployment — such as the hundreds of thousands working full hours for sub-minimum-wage income — highlights why a single statistic can understate the true scale of economic hardship.
What This Means for Panama
The core message for policymakers and business leaders is that the challenge does not end when unemployment falls. As the La Prensa piece puts it, progress requires that working actually allows people to get ahead — generating stable, productive job opportunities should guide both public and private decision-making.
For the government, this points toward policies that promote formalization of employment and wage adequacy, not just job creation. For the private sector, it underscores the role of businesses in offering formal, fairly compensated positions. And for the education system, it reinforces the need to prepare workers for productive, well-remunerated roles.
Key indicators to watch in coming months include whether underemployment declines alongside the unemployment rate, whether female labor participation continues improving, and whether contributions to the pension system rise as formal employment expands. For ordinary Panamanians, the measure of success will be simple: whether a full week’s work is enough to live on with dignity.
This story was originally reported by La Prensa.