Staffingamericalatina together with the World Employment Confederation continues to develop a series of interviews with key personalities in the world of staffing in the region.

In this issue we have interviewed Damian Wachowicz, Director of Baytongroup, a group of worforfoce solutions companies with presence in Argentina, Uruguay, Paraguay and Colombia. Damian is Chair of Latin America TaskForce and Public Affairs Director of WEC Latam

What are the main challenges and opportunities facing your labor market?

We can’t refer to challenges and opportunities without thinking about the elephant in the room which is informality. Informality is the largest and most widespread burden of labor market in Latin America. Generally speaking one every two workers is an informal worker  in the region, and that not only affects workers in general but also smaller segment minutes of workers, such as woman and young people. Which relates to another debt that we have in the region that is inclusiveness. Overall these are one of the aspects that end up being the most hardship of labor markets in our region. Moreover, if you want to reach that and you want to get people to get better jobs and get more formal jobs, you have to combine it with a long-term plan on education. And once again our region has one of the highest dropout levels in the world, with a lot of young kids not even with secondary education.

Everything within these aspects create one of the worlds largest skills gap. Liberal markets in Latin America are very challenging, they are very unrobust and obviously there is the huge challenge of regulation because the main view of most countries is that traditional full-time employment is the way forward for the future, where as most developed economies are showing that actually there’s a huge diversification of ways of working. So they are adapting their regulation to react to that.

On the other hand, when you look at the future of labor in the world and you look at skills necessary for that future, you come across the fact that a lot of soft skills will be more necessary rather than cognitive skills or technical skills. And Latin America displays a wide variety of communication and relational skills, so there is a huge opportunity to nurgure those skills and combine them to create more future proof workers in Latin America. Which will also be needed to combined with a huge reskilling an upskilling of basic technological skills.

But then on another positive note there’s a huge and very rapidly increasing ecosystem of startups. We have several unicorn, several up-and-coming startups, and a lot of them focusing on bridging the gap‘s in the educational and labor markets. Specifically, around how do you educate and how do you create more future proof technologically skilled workers, in Latin America there’s a huge focus of startups in that tech sector.

But overall Latin America is a very challenging market labor wise and it will be as for now, up to the private sector to make sure that skilling and the skills gaps end up being bridged in the region.

How do you see the industry’s role evolving in both the short and longer-term? What is the outlook for flexible staffing?

Mainly our industry role during the pandemic has been quite diverse in the different markets. In markets where penetration rate was higher we’ve seen our industry absorbing a lot of the shock of the pandemic, we’ve seen numbers of people employed, dropping 40, 50% in specific countries. In other countries where the penetration rates were smaller but the ingredients to use flexible solutions for employment were there, we have seen a huge increase, almost doubling the number of workers that were hired through our sector. So the impact has been quite different.

What we are seeing now in the short term is that out industry is playing a huge role in the recovery to pre-Covid labor statistics. Because our sector it’s viewed as one that provides the flexibility needed in very uncertain times and the regulatory conditions, the type of worker conditions are there; so our sector is one of the main sector that is responding to the labor crisis created by the pandemic.

In the long term there is a huge need for sector to get a more leading role in the upskilling and reskilling of labor. As was mentioned before, we have one of the highest informality rates and one of the largest skills gaps in the world and our sector needs to and has to take the initiative to further penetrate the upskilling and reskilling of the labor market in Latin America. Not only that but the technology gap in Latin America is huge, we have less than half of highly trained workers than for instance developed markets and we have more than double of the lower skills workers than developed markets. So the focus on the future of work has to be on reskilling and upskilling particularly in basic technological skills.

How has the Covid crisis affected your market? How prepared is your market for the post-Covid world of work?

The Latin American labor market was one of the hardest hits by the Covid pandemic. It is estimated that 49 mIlion workers dropped, almost 16.2 percent of drop in hours worked,  leading to 49 million workers being a affected by Covid . Out of those 49 million, there’s a huge percentage of those workers that were in the informal sector, so it’s been very heavily affected. Because it wasn’t even formal sector there’s a huge differentiated impact in terms of the different sub sectors of workers, specifically around woman and younger people. But its recovered not as fast as we’ve seen in other regions, actually in Latin America we have not yet reached pre-pandemic labor statistics. We are still missing around 4.5 million workers going into labor market. But one of the main challenges is that out of that recovery there is a huge percentage, between 60 and 80% of workers that have been going back to Labor market which have gone back into the informal sector once again. So actually the impact on informality throughout the pandemic has been quite stable and hasn’t helped on the redistribution and reconfiguration of the labor market in general.

How prepared is your market for the post-Covid world of work?

Since we are starting from the perspective of the fact that we had one of the biggest skills cops in the world, that our regulation was not very inviting of diverse forms of work, if we account for the fact that a remote work wasn’t even regulated in most of the countries, we are very unprepared to face the post covid world of work. On the positive side is that that is allowing for an acceleration of initiatives and items that end up being a quite positive for the future world of work in Latin America. But we’re still a long way to be able to absorbthe type of work that is coming in the region and  in the world.

What actions are you taking to support your members, their client companies and workers two lead in the new normal ?

There’s being a lot of track record in Latin America from our federations and from specific companies trying to engage in regulatory aspects of our sector, but not only in our sector but in the deliverers regulation in general. Particularly again because of the burden of informality and the very strict and tight regulatory schemes that existed throughout the region. So the focus has been very much into that. Now it’s evolving into a focus of how from our sector can we help in that recovery and how can we help client companies find the flexible solutions that they need in a new normal that is more unstable and more uncertain than before.

What benefits do we get for being part of an international network like the world employment confederation ?

The World EmploymentConfederación has been leading the world of work for now over 50 years and it’s one of the main institutions in the world that focus on how can we better improve labor markets and inclusivity across the worl. We have constant references from them in terms of what more developed economies are doing, what experiences people are having across different industries and we can then reapply them and refocus them on what’s needed on our sector. It creates a network of people that are heavily engaged in the labor market and people that are very passionate about how do we improve things going forward that creates a positive net worth of minds trying to solve the same type of problems. In Latin America  we have very specific problems because of the reasons that were mentioned before and being part of network like WEC helps us create an awareness of how the world can be better, how do labour markets can be better and what the different initiatives and roads to take us there could be. So from that perspective all the experiences that WEC members have in terms of engaging with different labor market stakeholders, like government, private sector or the educational sector, is one of the stronger aspects of what this type of networks can bring to the table.