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Latin America Investment News on Viva Tropical

Panama Needs More Flexible Labor Market, Current Laws Too Restrictive

Article Summary:

Panama’s labor laws are restricting the recruitment of foreign personnel and are a great obstacle to competitiveness and development of the country. In Panama, only 10% of a company’s staff may be foreign. According to some economists and managers, this reduces the competitiveness of most within the financial business sector.

Photo Credit: Prensa

Original Article Text From Prensa via Google Translate :

Labor Rigidity Hampers Economy

Laws restricting the recruitment of foreign personnel in companies with a presence in Panama are an obstacle for competitiveness and development of the local economy.

The tight labor market also makes Panama an attractive destination for investments less. In the latest ranking of global competitiveness of the World Economic Forum on line “labor market efficiency”, Panama fell to position 115 of 142 economies analyzed.

When consulted, the economist Ruben Lachman said the laws that set a limit of 10% are a drag. “It’s an absurd law. There should be no limitation. If people come to produce and work for Panama, what is the problem? “He asked.

For Roberto Brenes, manager of the Panama Stock Exchange, the labor regime “has been driven by a nineteenth-century position of the unions for not expanding the labor quotas.”

The laws affecting the hiring of foreign labor when most companies highlight the lack of qualified personnel to fill the jobs. In fact, the unemployment rate in the country is 4.5%, about what is technically considered full employment.

For Brenes, in sectors such as banking, technology, tourism and logistics should be expanded quotas.

“And not to bring manual laborers, but executive that would enhance these areas. Sitting around waiting that Panama generate resources through training is to miss the opportunity. These limitations of 10% shares are starting to remove her competition in the financial sector “, said the executive.

Link to Original Article:

From Prensa

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