To combat historically high unemployment, IDEAS Labs has collaborated with members of the Costa Rican Government and Social Security Fund to temporarily suspend labor contracts and adjust monthly social security payments for workers who are subject to reduced working hours due to COVID-19 restrictions. As a result, the changes are living examples of the meaning behind IDEAS Labs Freedom to Work project.
Luis Loría, president and founder of IDEAS Labs notes, “Since mid-March, the Costa Rican government response to the COVID-19 pandemic, which included complete lockdowns and restrictions to the operation of businesses, resulted in a 100% increase in the unemployment rate.” This increase motivated IDEAS Labs to push for a solution that would temporarily reduce the impact of unemployment without causing lasting effects to the overall economy.
“Costa Rica is a natural paradise, but it is also a regulatory hell,” says Loría. However, with Congressman Pedro Muñoz spearheading discussion on the national level, IDEAs Labs was able to make real, immediate public policy changes. Although the current suspension of labor contracts and adjustments to monthly social security payments are temporary, IDEAS Labs continues to work with Congress to produce long-lasting reforms.
IDEAS Labs Freedom to Work project was launched to combat persistent, high unemployment rates in Costa Rica that lead to extremely high informal sector employment rates. This drives up minimum wage and formalization costs, effectively hindering competition in the market. Since the launch of their Freedom to Work project, IDEAS Labs has seen great success. They currently have “three reform projects that are being discussed in Congress that could have a significant impact in reducing the share of workers in the informal sector and unemployment,” says Loría.
Through their Freedom to Work project, IDEAS Labs continues to work tirelessly to educate the general public about the relationship between work and human dignity as a mechanism to escape from poverty.
This project was supported by Atlas Network with a grant.
