Roundup: One in three Latin Americans risk sliding back into poverty: UN report

A UN report on Tuesday said that one in three Latin Americans who left poverty since 2003 -- that is 25 to 30 million women and men -- risk sliding back into poverty, but a new generation of public policies in line with the Sustainable Development Goals (SDGs) can boost resilience and prevent setbacks.

The United Nations Development Programme's (UNDP) latest Regional Human Development Report, launched on Tuesday in Panama, said that this at-risk group is part of an even larger set of people: 220 million people (almost two in every five in the region) are "vulnerable," UN spokesman Stephane Dujarric told reporters here.

"Although they are not officially classified as poor they have been unable to rise to the middle class," the spokesman said. "The report recommends social protection, care systems (especially for children and older persons), labor skills and closing historic gender, racial and ethnic gaps."

The main threat to progress in Latin America and the Caribbean is the relapse of millions of families back into poverty. The economic slowdown is part of the story, but not the only cause of such a setback, said the report, launched with more than 60 congresspersons at the regional parliament (Parlatino).

To continue to advance and prevent reversals in the social, economic and environmental fronts, the report highlighted key policy recommendations, in line with the Sustainable Development Goals (SDGs), a set of 17 targets approved by world leaders here in September 2015 to serve as the blueprint for the global development efforts for the next 15 years.

In the report titled Multidimensional Progress: Well-being beyond income, UNDP expressed particular concern over the group of people, representing 38 percent of the population in the region. Of them, many are youth and women, with precarious employment in the service sector.

Officially, they are not poor -- living on less than four U.S. dollars per day, but have been unable to rise to the middle class -- living on more than 10 U.S. dollars a day.

The factors that pushed people out of poverty are different from those that prevent them from falling back, the report said. In the past decade, labor markets and education were the biggest engines behind exiting poverty.

However, the report argued that it is essential that a new generation of public policies strengthen the four factors that prevent setbacks: social protection, care systems (particularly for children and older persons), physical and financial assets (such as owning a car, a home, savings or bank accounts that act as "cushions" when crisis hit), and labor skills.

These four key elements comprise what the regional the report branded as a "resilience basket," enabling people to absorb shocks and prevent setbacks. This is especially important during economic slowdowns.

Meanwhile, the UNDP report called on Latin Americans to rethink the region's progress along multidimensional lines, inspired by the 2030 Agenda for Sustainable Development. New metrics beyond per capita income, economic growth rates and Gross Domestic Product (GDP) are needed to measure development.

Nothing that reduces the rights of people and communities or threatens environmental sustainability can be considered progress, the report said.

"The challenges of sustainable, holistic and universal development do not end at a certain income threshold: we don't 'graduate' from development challenges unless we can respond accordingly to the multiple dimensions that enable people to live the lives they consider valuable, "said the UN assistant secretary-general and UNDP regional director for Latin America and the Caribbean, Jessica Faieta, at the report launch.

"Right now, on the one hand, we must protect the region's past achievements, including preventing millions of people from falling back into poverty; on the other hand, we must also promote inclusive policies and comprehensive strategies for populations suffering from historical discrimination and exclusion."

More of the same does not yield the same results. While about 72 million people were lifted from poverty and 94 million rose to the middle classes between 2003 and 2013, the region experienced a recent slowdown and reversal of poverty reduction rates.

The annual average of Latin Americans lifted from poverty was nearly eight million between 2003-2008 and five million between 2009-2014, according to the report. However, in 2015 and 2016, for the first time in decades, the region saw a rise in the number of poor women and men.

This reversal is not due to the economic slowdown alone. It also results from the limits of labor and fiscal expansions in the region, and the substantive number of informal jobs. More than half of the 300 million workers in Latin America and the Caribbean work either in micro-enterprises with fewer than five employees, or as self-employed unskilled workers or earning no income (apprenticeship programs, for example).

Also, of the more than 50 million small and medium-sized enterprises, 70 percent are informal, and two of every three new jobs created in the region were in the service sector, which has low productivity and high rates of informality.

Without future increases in productivity in sectors with unskilled workers, the sustainability of growth and, consequently, of social attainments is undermined, the report said.

Moreover, the expansion of conditional cash and other social transfers and non-contributory pensions, which account for about 30 percent of the income inequality reduction since 2002, has also reached a fiscal ceiling. The report also pointed out that the tax burden on the region's poor is so high that it usually overrides the benefits received by social transfer programs.

Investing in women and care policies is key if the region is to leap forward, the report argued. Although the proportion of women with university degrees in the region was higher (17.3 percent) than the corresponding proportion of men (14.8 percent), in 2013, women earned an average hourly wage 16.4 percent lower in relation to men.

In addition, women work three times more at home than men. Demographic trends and the absence of care mechanisms (especially for children and older persons) restrict better participation of women in the labour market and the families' income generation, the report said. Endit