Observation (CEACR) - adopted 1994, published 81st ILC session (1994)

Employment Policy Convention, 1964 (No. 122) - Uruguay (Ratification: 1977)

1. The Committee notes the Government's report for the period ending June 1992. The Government indicates that employment policy is considered as a result of the achievement of the objectives of the economic programme, employment promotion being closely linked to the success of economic measures implemented. With the implementation as of 1990 of the structural adjustment programme, the Government's policy has given priority to re-establishing the major macro-economic balances - the objective of monetary and budgetary policies was to reduce inflation and contain the budget deficit. Substantial results have been attained in these areas. However, despite product growth (7 per cent in 1992), overall employment grew only slightly and the unemployment rate fluctuated around 9 per cent (these data concern the urban labour market). The information supplied by the Regional Employment Programme for Latin America and the Carribean (PREALC) shows that unemployment is still affecting one worker out of five, as it did at the end of the past decade, and that women and young people are the hardest hit by unemployment. The youth unemployment rate is triple the average and PREALC considers that it probably contributes to the emigration of skilled young people. The Government recognizes that "structural adjustment, which the Uruguayan economy inevitably has to undergo, has caused an involuntary and temporary increase in unemployment and underemployment, in both absolute and relative terms". As to the effects on wages and incomes, the Committee notes that, owing to a policy to abolish the indexation of prices and wages, real wages increased substantially in the private sector but fell in the public sector and that, in 1992, the minimum wage was equivalent to only 60 per cent of the 1980 real wage.

2. In its 1992 observation, the Committee referred to Part IX of the Employment Policy (Supplementary Provisions) Recommendation, 1984 (No. 169) and pointed out that it was necessary to share out fairly the social costs and benefits of structural adjustment. In view of the difficulties that the Government still seems to be experiencing in promoting the objectives of the Convention, particularly in "solving the unemployment and underemployment problem", the Committee trusts that it will take the necessary measures to determine and apply, "as an essential objective", an "active" employment policy, "within the framework of a coordinated economic and social policy" (Articles 1 and 2 of the Convention). The Committee would be grateful if in its next report the Government would supply relevant information on the measures taken in the different areas referred to in the report form, together with particulars of the situation, level and trends in employment, underemployment and unemployment in the country as a whole, including in respect of women and young people. It would also be grateful if the Government would describe the procedures adopted to ensure that their effects on employment are taken into consideration in the formulation and implementation of macro-economic policies.

3. The Committee notes the information concerning the agreements concluded by the Wages Council which, in the Government's view, are an outstanding example of long-term tripartite agreements comprising pre-established criteria for wage adjustments in the context of stability of employment. The Committee would be grateful if, in its next report, the Government would provide information on consultations held on employment policy; such consultations must, under Article 3 of the Convention, aim to ensure that full account is taken, in both formulating and implementing employment policy, of the experience and opinion of the representatives of those affected (representatives of employers and workers organizations, and also representatives of other sectors of the active population such as the rural and informal sectors).

4. In a direct request the Committee asks for information on other issues concerning the application of the Convention (impact of the labour legislation on the labour market, special measures for the categories of workers most affected by unemployment and underemployment, coordination of education and training policies with employment policy, ILO technical cooperation).