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Out of Agriculture, Sill Vulnerable: Rural Labor Markets in Latin America

Rural poverty has declined substantially in Latin America over the past two decades, yet vulnerability remains high and rural–urban gaps persist. This paper examines the factors associated with this persistence using harmonized household survey microdata for 14 Latin American countries over 2003–2023. We document three main patterns. First, persistent rural disadvantage does not appear to reflect a worsening composition of the rural population: rural–urban gaps narrowed in household demographics, educational attainment, and access to basic services. Second, rural employment shifted markedly away from agriculture, with the agricultural share falling from 53% to 43%, while informality also declined. Yet convergence in job quality was much more limited: rural workers remain more informal, less concentrated in high-complexity occupations, and lower paid than urban workers, with lower returns to education. Importantly, these disadvantages extend to the increasingly prevalent non-agricultural rural jobs. Third, vulnerability is not confined to agricultural households: poverty remains substantial among non-agricultural rural households, which now account for nearly half of the rural poor. Overall, the evidence highlights a central distinction between sectoral reallocation and improvements in job quality: moving out of agriculture has not, by itself, eliminated rural vulnerability.

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https://scioteca.caf.com/handle/123456789/2708

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2026-09-04

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6.1 Documentos de trabajo en investigación socioeconómica

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Out of agriculture, still vulnerable_Rural Labor Markets in Latin America.pdf (1.58 MB)

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