Honduran labor outlook for 2025: unemployment unabated

The economic forecast for Honduras in 2025 encounters major obstacles, marked by a substantial rise in joblessness and a significant drop in foreign direct investment (FDI). These circumstances depict a scenario of political and economic unpredictability, influencing both the employment sector and the confidence of investors, which affects the nation’s growth and steadiness.

The rise in the unemployment rate and the drop in FDI emphasize structural issues that need urgent attention. The scenario demands the adoption of policies that encourage the creation of formal employment and enhance the investment climate to support sustainable economic development and lessen the vulnerability of groups such as youth and women.

Increasing joblessness and labor conditions in Honduras

According to the Honduran Council of Private Enterprise (COHEP), the unemployment rate reached 7.2% by the end of 2024, showing an increase that intensifies the labor crisis. This phenomenon mainly affects women and young people, who face greater difficulties in accessing formal and stable jobs. Underemployment also affects more than 1.6 million people, indicating that a significant portion of the population works in conditions that do not meet their economic needs.

Furthermore, close to a million young individuals encounter obstacles when trying to access the formal job market, which restricts their chances for career growth. Informal jobs remain a significant issue, as 37% of the workforce aged 15-29 is engaged in informal employment, indicating job instability and the absence of social benefits.

These situations impact not just the well-being of employees, but they also restrict economic progress and the nation’s potential to draw in investments. Employment instability and market volatility may impede economic recovery and efforts to alleviate poverty.

Decrease in overseas investment and financial forecast

During 2024, foreign direct investment in Honduras showed a downward trend. As of September of that year, FDI stood at $590.7 million, representing a reduction of $172.5 million compared to the same period in the previous year. This decline reflects an environment that generates uncertainty among investors, affecting the inflow of capital necessary for economic development.

The Milken Institute’s 2025 Global Opportunity Index (GOI) ranks Honduras last in Latin America in terms of investment attraction, underscoring the need to improve aspects such as legal certainty, infrastructure, and political stability. The reduction in FDI limits the financing of productive projects and infrastructure essential for growth.

Therefore, the increase in unemployment and the decline in foreign direct investment in Honduras over 2024 and 2025 indicate an uncertain environment impacting both economic and social stability. Implementing integrated and cohesive strategies will be essential for enhancing the country’s economic and employment outlook.

To change this scenario, it is seen as crucial to put in place measures that boost investor trust, enhance infrastructure, and enhance security. A joint effort by the government, the business sector, and civil organizations is vital to tackling ongoing economic and employment issues and encouraging more robust and fair development.