2026/05/29 | Vittorio Peretti, Carolina Monzón, Juan Robayo & Angela Gonzalez
According to DANE’s labor report for April, the national unemployment rate remained stable from the previous year at 8.8%. The urban unemployment rate increased mildly to 8.8%, a rise of 0.1pp year on year, well below the Bloomberg market consensus of 9.2% and our 9.9% call. Employment increased by 3.0% YoY in April (+2.7% YoY in March). The labor force also rose by 3.0% YoY (+1.8% YoY in the previous month). The participation rate increased by 1.0pp to 64.7%. Sequentially, employment fell by 0.3% MoM (+0.2% MoM in the previous month). The seasonally adjusted urban unemployment rate dropped to 8.8% from 9.0% in the previous month, sitting well below BanRep’s NAIRU of 9.6%.
Private salaried jobs drive employment dynamics. In the quarter ending April, employment rose by 2.8% YoY (+2.3% in 1Q26). This annual increase was driven by a 4.6% YoY rise in private salaried posts (+3.0% in 1Q26), while self-employment increased by 1.6% YoY (+1.9% in 1Q26). Meanwhile, public sector jobs fell by 2.3% YoY, down from the +1.0% YoY registered in 1Q26. In the quarter ending April, financial and insurance activities, public administration and IT were key job drivers, while agriculture shed jobs.
Our take: The labor market continues to show resilience. Looking ahead, rising labor costs, elevated inflation and high interest rates are expected to take their toll on GDP growth dynamics and labor demand. We expect an average unemployment rate of 10.2% this year.