The Central Bank of Colombia released a Regional and Urban Economics working paper by Karina Dianeth Acosta-Ordoñez and Jesús David Saldaña-Arroyo analysing the drivers of changes in Colombia’s monetary poverty over the past decade, with a focus on the rapid decline during the post-2020 recovery. The paper uses a statistical decomposition of household income sources to identify which factors most affected household welfare across large cities, rural areas and regions. The analysis finds two distinct phases. From 2012 to 2019, poverty fell mainly due to demographic shifts and rising formal employment, while the faster reduction from 2021 to 2024 was driven primarily by a strong labour market rebound, with new jobs offsetting the scaling back of government assistance provided during the health emergency. It also reports that relying only on current subsidies would have implied an increase in poverty, and that outcomes were uneven, with large cities leading national improvements, several Caribbean regional capitals showing limited progress, and rural poverty reduction linked more to agriculture, informality and non-labour income than to formal employment.
Central Bank of Colombia 2026-03-10
Central Bank of Colombia publishes working paper on why post-pandemic labour market recovery drove the 2021–24 fall in monetary poverty
The Central Bank of Colombia published a working paper analyzing changes in Colombia's monetary poverty over the past decade, highlighting a rapid decline during the post-2020 recovery. The study identifies two phases: a demographic and employment-driven reduction from 2012 to 2019, and a labour market rebound from 2021 to 2024. Findings indicate uneven progress, with large cities leading improvements while rural areas rely more on agriculture and non-labour income.