Colombia's January unemployment rate falls to 10.9%

DANE reported a 10.9% unemployment rate for January 2026, the lowest in recent history for a first month of the year, despite a 23% minimum wage increase. Informality dropped to 55%, and the employed population grew by 324,000 people. Yet, these official figures are sparking political polarization.

The National Administrative Department of Statistics (DANE) released data showing a 10.9% unemployment rate in January 2026, a historically low level for that period, following a 23% minimum wage adjustment that sparked debates on potential layoffs. Labor informality fell to 55%, one point lower than in January 2025, excluding the rural sector, while self-employed workers have risen, boosting employment.

In the labor market, notable increases occurred among public employees, teachers, and armed forces members. Positions also grew in professions such as caregivers, nurses, doctors, and administrative services. However, the overall labor participation rate dropped by half a percentage point, with 410,000 additional people classified as economically inactive.

Job losses were recorded in sectors like commerce (149,000), accommodation and food services (109,000), and public services (69,000), attributed to post-December holiday adjustments. Conversely, the employed population rose by 324,000, mainly in public administration, education, and health (172,000), professional activities (155,000), and manufacturing (134,000). Compared to January 2025, the employed population increased from 22.9 million to 23.2 million, a 1.5% annual growth.

La República's editorial warns that distrusting DANE's figures could lead to informational chaos, particularly ahead of presidential elections. It emphasizes the need to examine independent workers' compliance with parafiscal contributions and social security, and notes that DANE, despite its flaws, remains the reliable source for the OECD and researchers.

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Joyful diverse Colombians on a Bogotá street celebrating record-low 8.9% unemployment rate since 2001, with job growth billboard.
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Colombia's unemployment rate reaches lowest since 2001

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Colombia's National Administrative Department of Statistics (DANE) reported that the unemployment rate for 2025 was 8.9%, the lowest since 2001. This figure marks a 1.3 percentage point decrease from 2024. In December 2025, the rate fell to 8%, with employed population rising by 603,000 people.

In January 2026, Colombia's unemployment rate stood at 10.9%, the lowest for a first month since 2001, according to the Dane. While 324,000 new jobs were created, 60% were self-employment positions. This indicates employment improvement, but raises concerns about job quality.

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In January 2026, Colombia's unemployment rate stood at 10.9%, the lowest for any January since 2001, with 324,000 more workers than in the same month of 2025. The number of unemployed people fell by 186,000 to 2.8 million. This improvement was driven by growth in self-employment and people leaving the labor force.

Colombia's minimum wage rose 23% for 2026, prompting over 14% of firms to switch from integral to ordinary salaries. A study by the Colombian Federation of Human Management indicates 32% of companies cut expenses while 24% turn to AI automation. Meanwhile, J.P. Morgan notes a robust labor market beforehand, with unemployment at historic lows.

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Colombia's National Administrative Department of Statistics (Dane) reported that annual inflation for January 2026 stood at 5.35%, up 13 basis points from January 2025. Driven by lodging services, restaurants, and food, the figure slightly exceeded market expectations. This data will guide the Central Bank's monetary policy decisions.

One week after President Gustavo Petro decreed a 23% minimum wage increase for 2026—setting it at 1,750,905 pesos based on ILO 'minimum vital' standards for a three-person family—experts warn of inflation exceeding 6%, interest rates rising to 11-12%, and price hikes across sectors, potentially eroding informal workers' purchasing power.

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Colombia's hotel sector saw a 3.5% drop in real revenues in October, driven by a 32.8% decline in the Pacific region. While real wages rose 3.3%, occupied personnel fell 1.8% nationally. Cotelco calls for policies to boost tourism competitiveness.

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