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Immigration Up 24 Percent in Chile, Will Likely Raise Unemployment Rates in Latin America's Richest Country

First Posted: Jul 05, 2014 02:39 PM EDT

Immigration into Chile jumped 24 percent last year as workers from countries like Colombia, Peru and Spain came to the wealthiest country in Latin America looking for jobs, according to a Bloomberg report.

In 2013, 158,128 people received either temporary or permanent residency in Chile, according to a report from Chile's immigration department. That's up from 127,362 in 2012 and nearly tripled from 2006, when the number was just 60,280.

Peruvians accounted for the most immigrants into Chile last year, with 57,818 arrivals, followed by 30,137 Colombians and 5,739 Spaniards. The U.S. even got in on the action, with 3,756 Americans coming to Chile.

The 183,240-person-large workforce increase last year can be attributed to the arrival of immigrants, Bloomberg reported.

"Immigration contributed to economic growth until last year, when there was a high demand for workers," Hermann Gonzalez, an economist in Chile working at BBVA bank, told Bloomberg. "They helped stop wage increases, which could have been higher without them."

Despite helping increase the workforce, these immigrants may actually increase unemployment in the country.

The Chilean unemployment rate was 5.7 percent at the end of 2013, down from a recent high of 9.7 percent at the end of 2009, according to Trading Economics. By the end of May of this year, however, the unemployment rate had risen to around 6.3 percent.

According to Bloomberg, Chile's Central bank President Rodrigo Vergara said in June that unemployment will likely increase in the coming quarters, even if the labor market shows no significant decline. The immigrants are coming for jobs that previously would have been for Chileans, especially in the construction and retail industries.

Chile has been named Latin America's wealthiest nation, based on purchasing power, according to the International Monetary Fund. Chile's per capita income is $19,887, compared to $11,735 in Peru and $11,730 in Colombia.

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