30 de diciembre de 2014 / 13:12 / en 3 años

UPDATE 2-Chile's labor market resilient despite economic slowdown

(Recasts, adds analyst’s comments, background)

By Anthony Esposito

SANTIAGO, Dec 30 (Reuters) - Chile’s labor market has remained more resilient than feared in the face of a prolonged economic slowdown, a mixed bag of government data showed on Tuesday, as factory output posted an unexpected drop.

The jobless rate for the September to November period fell to 6.1 percent, from 6.4 percent in August to October, the national statistics institute (INE) said.

For President Michelle Bachelet the jobs data comes as a welcome surprise as she faces a stagnant economy and backlash from business leaders and opposition lawmakers for a planned reform that seeks to balance labor relations by bolstering unions and workers’ rights.

The economy of the world’s top copper producer has been slowing for several quarters, hampered initially by cooling investment, most notably in the mining sector, with the slowdown compounded by falling household consumption.

Economic growth in 2014 is seen cooling to a five-year low of 1.7 percent, according to the central bank. That compares to growth of 4.1 percent in 2013.

“The better-than-expected jobs report is reassuring. With a significant rebound in investment spending out of sight, the burden of the economic recovery will likely fall on the shoulders of private consumption, which is more directly influenced by labor market conditions,” said Tiago Severo, economist at Goldman Sachs.

Retail sales, a barometer of consumption, grew 0.4 percent in November versus a year earlier, after posting two prior consecutive monthly contractions.

The rebound comes “in a context of slightly better labor market data as well as a moderate increase in consumer and commercial loans,” INE said.

For its part, manufacturing production fell 1.1 percent in November from a year earlier driven by lower output of food and beverages, especially wine, and reduced demand for metallic structures from the mining and construction sectors.

It was the seventh monthly drop in factory output this year and compares to analysts’ expectations for a 0.1 percent rise.

“The November (factory) data published by the INE makes it difficult to forecast an important recovery during the last part of the year, as there is still evidence of negative output in some industrial sectors,” said CorpResearch in a note to clients.

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Click for a chart on Chile’s manufacturing production

link.reuters.com/qyz37s

Click for a chart on Chile’s unemployment

link.reuters.com/num47s ^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^ (Reporting by Anthony Esposito; Editing by W Simon and Chizu Nomiyama)

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