Nicaragua - Working conditions

In 1999, the nation's unemployment rate was 10.5 percent, the lowest level since the 1970s. With 1 out of 10 Nicaraguans unemployed, the competition for jobs is intense. Many Nicaraguans find themselves forced to take jobs for which they are overqualified. In 1999, the underemployment rate was 36 percent. The nation's constitution guarantees workers the right to organize and join unions. Overall union membership is declining because of the competition for jobs and the increasing number of foreign companies entering the country (many of these firms are resistant to unionization because of the increased labor costs).

Child labor is forbidden by law. The 1996 Labor Law raised the minimum age to employ children from 12 to 14 years old. Parental permission is required for anyone under the age of 16. However, estimates are that as many as 42 percent of children between the ages of 6 and 9 work. A 1999 government study found that 6,219 children in Managua work in occupations such as car washers, street vendors, and beggars.

Distribution of Income or Consumption by Percentage
Share: Nicaragua
Lowest 10% 1.6
Lowest 20% 4.2
Second 20% 8.0
Third 20% 12.6
Fourth 20% 20.0
Highest 20% 55.2
Highest 10% 39.8
Survey year: 1993
Note: This information refers to expenditure shares by percentiles of the population and is ranked by per capita expenditure.
SOURCE: 2000 World Development Indicators [CD-ROM].

The minimum wage varies from sector to sector. The monthly minimum wage for agriculture is set at US$36, fisheries at US$56, manufacturing at US$48, government at US$44, restaurants and hotels at US$72, construction at US$96, mining at US$68, and banking at US$80. Except for the construction, banking, hotel, and mining sectors, the minimum wage does not provide enough income for an average family to live. As a result, many workers supplement their wages in the informal economy .

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