Education at the Heart of Panama’s Jobs Challenge as Youth Enter Labour Market Unprepared

Business leader Jean Pierre de Roux, chair of Nueva Generación, echoed the need for inclusive access, stressing that education reform must be national in scope.

Each year, thousands of young people in Panama enter the labour market without the skills and preparation needed to secure decent, formal employment. According to the World Bank, a child born in Panama today is expected to reach only half of their potential, largely due to gaps in education and health—shortcomings that disproportionately affect the country’s most vulnerable communities.

This human capital deficit stands in sharp contrast to Panama’s strong macroeconomic performance. While the economy has grown rapidly over recent decades, job creation has been concentrated in low-wage, highly informal sectors, limiting the country’s ability to translate economic success into shared prosperity.

Against this backdrop, the World Bank Group convened representatives from civil society and the private sector in Panama to discuss pathways toward better jobs, higher productivity and poverty reduction. A clear consensus emerged: education reform is the single most critical lever for improving labour market outcomes and strengthening Panama’s human capital.

An Educational Revolution: Urgent and Unavoidable

Participants agreed that access to quality education is fundamental to breaking the cycle of poverty and informality. While Panama has made progress in expanding schooling, serious deficiencies remain in learning outcomes and workforce readiness.

“A good job is the safest path out of poverty and a source of dignity and purpose, but in Panama there are significant deficiencies in education and effective training that would allow Panamanians to perform fully,” said Carlos Araúz, president of Fundación Calicanto.

Business leader Jean Pierre de Roux, chair of Nueva Generación, echoed the need for inclusive access, stressing that education reform must be national in scope.

“It is extremely important to continue addressing education at a massive level. The aspiration should be for all Panamanians to have access to quality education,” he said.

However, participants cautioned that the challenge goes beyond coverage. Araúz noted that the system often fails to identify and address the root causes of learning gaps.

“Perhaps we have become obsessed with providing schooling for the sake of providing it, without understanding how learners fall behind,” he said, arguing that reform must span early childhood development, primary and secondary education, and universities, many of which lag in technology and modernisation.

Aligning Education with the Needs of Today’s Economy

The World Bank’s report The Future of Work in Central America and the Dominican Republic highlights that technological change presents major opportunities for workers in the region. In Panama, however, the adoption of new technologies in education and training remains limited.

“The focus must be on education adapted to 21st-century requirements—education that integrates technology, fosters innovation and responds to the country’s evolving needs,” said Rosemary Piper, Executive Director of the National Competitiveness Center.

From the private sector’s perspective, the most pressing need is to strengthen technical and vocational education. Manuel Ferreira, Director of Economic Affairs and Analytics at the Chamber of Commerce, Industries and Agriculture of Panama, pointed to dual education models as a key solution.

“Combining study and work is essential. If we prepare people through dual education, their employment prospects will improve, and so will the broader economic environment,” he said.

Collaboration Key to Unlocking Panama’s Potential

Civil society organisations highlighted that the consequences of weak education systems are already visible in youth unemployment figures and international learning assessments.

“Young people are falling behind compared to those in similar countries,” said Camila de Vengoechea, president of the Panamanian Chamber of Social Development (CAPADESO). “This is why so many nonprofit organisations invest in education—the need is real.”

She added that inequality in education outcomes disproportionately affects women, young people, Indigenous communities and rural populations, making inclusive reform essential.

Improved human capital, participants agreed, would also have a powerful multiplier effect—stimulating entrepreneurship, diversifying the economy and enabling Panama to move into higher-value sectors.

“We should not abandon efforts to support entrepreneurs; we also need employers who can drive growth,” Piper said. “As we better prepare people at technical and higher-education levels, we can transition toward more advanced sectors with better wages and higher skill requirements.”

A Clear Diagnosis, an Urgent Call to Act

Despite differing perspectives, participants shared a common diagnosis: Panama cannot afford to delay education reform.

“Public education must be reformed and strengthened. It is a shared aspiration and a long-standing debt,” de Roux said.

Only through inclusive, modern and labour-market-aligned education will Panamanians be able to realise their potential, access better jobs and contribute meaningfully to the country’s development. The challenge is significant—but so is Panama’s potential.

With broad consensus already in place, stakeholders agreed that the time has come to turn education into a true engine of job creation and shared prosperity.