Nicaragua – Jobs Diagnostic: Toward a Jobs and Economic Transformation Strategy

The Nicaragua Jobs Diagnostic applies the Bank's standard Jobs Diagnostics tool to explore trends and macro drivers of economic and jobs transformation, labor market outcomes from the supply side, and sources of job creation from the perspective of the demand or private sector sides. The report shows that the distributions of jobs and production (value added) do not show significant changes over the last 15 years. This finding is directly linked to the slow urbanization and the predominance of subsistence agriculture in rural areas, thus reinforcing and urging the need to shift the Nicaraguan economy towards higher productivity, employment creation, and formalization to support future growth in jobs. The recommendations address structural and short-term challenges focusing on labor and jobs growth. This report will serve the country and sector teams as an entry point to explore future areas of interest, as it is designed to serve as a baseline to understand the economic transformation trends until 2018; particularly in the event of the shock that shrank the economy by more than 3 percent