chapter  2
20 Pages

Labor Market Functioning in Paraguay

ByGuillermo García-Huidobro

Changes in the supply of labor are substantially determined by population growth, which although declining continues high in Paraguay at probably around 2 percent per year. 1 Population growth and structure is substantially set by fertility (DGEEC, 1996) and in lesser degree by mortality and migration. Although the total fertility rate fell from 6.55 during 1960-65 to 4.55 in 1990-95 according to official DGEEC estimates, and on to 3.7 by 2005, 2 Paraguay still exhibits a very high fertility rate, matched only by Bolivia within the region. In the demographic transition phase in which Paraguay now finds itself there have been important declines in the death rate, especially in the younger age groups; this, combined with high fertility rates, produces a young age structure and the associated high rate of dependency (DGEEC, 1996).