Thousands of young Panamanians are building their own economic opportunities. They face significant barriers to entering the formal job market. Product reselling, gastronomy, content creation, and creative industry activities have become key income sources.
Many of these workers are under 35 years old. They often hold academic degrees or have acquired specialized skills. Yet a large portion has chosen entrepreneurship, sometimes operating within the informal sector, to forge their own financial paths. Labor Market Young participants are increasingly shifting toward self-employment as traditional hiring stalls.
Economist Ana Patiño provided stark numbers on the situation. Of approximately 455,000 employed young people in Panama, 54 percent work in the informal economy. “Of those 455,000 young workers, 54 percent are in the informal sector, and that is definitely because they are looking for an option since they don’t have formal employment and they have to learn,” Patiño said. [Translated from Spanish]
The Informal economy in Panama has become a default survival mechanism for many. Young workers lack access to formal contracts, social security benefits, and stable wages. Patiño noted that women face even greater obstacles when trying to secure formal jobs. She called for strengthening entrepreneurship programs with a gender-focused approach.
At universities, students like David Hernández maintain hope for formal employment after graduation. But they also explore entrepreneurial alternatives driven by personal interests. “I wanted to work for myself because I feel that would give me more freedom. I really like cooking and finance, so honestly my own restaurant would be a good option,” Hernández said. [Translated from Spanish]
“Tengo 14 años en la música y mi empleo base era de valet parking hasta que encontré la oportunidad.” – Luis Enrique Castro [Translated from Spanish: “I have 14 years in music and my base job was valet parking until I found the opportunity.”]
New technologies have opened doors for young entrepreneurs. Many develop projects in the Orange economy, creative industries, and digital content creation. These fields require low startup capital but offer high flexibility. Traditional trades also persist as income sources for those unable to enter formal employment. Luis Enrique Castro, a DJ, found his opportunity in music after years working other jobs.
Youth Unemployment Figures Remain a Major Concern
Beyond the challenge of informality, youth unemployment itself continues to worry experts. Data shows approximately 113,000 young people are actively seeking work without success. That figure represents roughly one in five young Panamanians. The Youth unemployment in Latin America crisis mirrors patterns seen across the region. Many countries struggle to absorb young workers into formal economies.
Commerce remains one of the primary sectors where young people try to establish themselves. When formal labor market doors do not open, selling products online or in local markets becomes the fallback. Patiño emphasized that policymakers must address structural barriers. She noted that the informal sector offers no safety net. No pension contributions. No health insurance. No job security.
Young entrepreneurs like Hernández and Castro represent a growing trend. They turn hobbies into businesses. They leverage digital platforms to reach customers. They build brands from scratch. But experts warn that informal entrepreneurship cannot replace quality formal employment at scale. The economy needs both job creation and support for small businesses to thrive.
Government agencies have launched some training programs. Private sector initiatives also aim to connect young talent with companies. But the gap between labor supply and demand remains wide. Patiño argued that targeted policies must prioritize young women. They face double discrimination in hiring and face higher barriers to capital for their businesses.
The creative economy offers particular promise. Music, design, video production, and digital marketing allow young people to monetize skills without traditional credentials. Castro’s story illustrates this path. After years parking cars, he built a career as a DJ. His income now comes from events, online streams, and music production.
Hernández still pursues his university degree. But he already plans for a future that may not include a corporate job. His restaurant dream combines two passions. Cooking and finance. He studies both. He believes self-employment offers more control over his life and schedule.
Patiño’s data tells a clear story. The formal labor market cannot absorb the young workforce fast enough. Until that changes, young Panamanians will continue creating their own opportunities. Some will succeed. Many will struggle. All of them are adapting to a reality where traditional employment is no longer guaranteed.