Income below the minimum wage, the big problem of informality in Colombia
Informality, the ghost that lingers in Colombia. Photo: iStock
TL;DR
- Unemployment rate in Colombia was 9.2% in February, with job growth contributing to the reduction.
- Informality remains the main challenge in the labor market, standing at 55.3% in February 2026.
- Informal jobs are associated with low productivity and low wages; informal workers' income grew less than half that of formal workers in the last decade.
- Informal workers are often excluded from pension contributions, risking their old-age security.
- Income for informal workers in 2024 barely surpassed 2015 levels, while formal workers saw a 19% improvement.
- Formal workers' real income grew 20% in the last decade, more than double the 9% growth for informal workers.
- The poorest 20% of the population can barely cover the poverty line, a situation that has worsened.
- The article suggests rethinking mechanisms to facilitate entry into formality, considering the effects of a restrictive minimum wage.