Chile's economy will end 2026 with no growth, and the unemployment crisis will persist over the coming quarters, according to El Mostrador, which obtained the October report from Chilean economic consultancy Gemines. The document attributes the weakness to consumption, investment and construction, rather than primarily to mining.
"This year is already a done deal," says Gemines General Manager Tomás Izquierdo. He acknowledges that the outcome could range from a small expansion to a slight contraction, but believes a few tenths of a percentage point do not change the assessment of a lost year.
The authors differ slightly. Alejandro Fernández anticipates a slight annual contraction, while Izquierdo describes an outcome close to zero. Both agree that the problem goes beyond isolated setbacks in mining production.
The contrast with foreign trade is striking. Gemines highlights high copper prices, terms of trade (the relationship between the value of exports and imports) near historic highs and a trade surplus of more than US$34,000 million over twelve months. That tailwind has not translated into greater domestic activity.
The consultancy's figures illustrate the situation. Through August, non-mining activity grew just 0.4% compared with the same period in 2025, in seasonally adjusted terms (adjusted to remove calendar and seasonal effects). Including mining turns the result into a decline of 0.5%.
Izquierdo notes that mining accounted for less than 10% of GDP (gross domestic product, the value of everything the country produces) in 2025. Its decline is therefore insufficient to explain the overall performance on its own. Copper is worsening an already weak situation.
The diagnosis points to depressed demand. Private consumption has grown marginally over the past four quarters, and fixed capital investment fell in the first half of 2026. Construction has contracted for four consecutive quarters, with a large stock of unsold homes.
External pressures add to this: more expensive energy and inputs, higher international interest rates and the depreciation of the peso. Gemines also acknowledges the impact of accidents at El Teniente, Codelco's mine, and problems with fishing catches, although it considers them insufficient to explain the full picture.
For 2027, the consultancy projects growth slightly above 3%, driven by investment, which is expected to grow by slightly less than 10%. Izquierdo links that improvement to reduced uncertainty following the enactment of the Reconstruction Law, particularly for the real estate sector and its suppliers.
The rebound, however, would not resolve the labor market problem. "The ongoing crisis observed in our labor market is very serious and deep, and nothing indicates that it will be resolved in the coming quarters," the report warns. Unemployment would fall somewhat, but remain well above its levels before the social unrest.
The explanation lies in a gap. Since March 2023, the real labor cost index has risen 10.1%, while output per worker, calculated using Imacec (the monthly economic activity index) and employment, has increased by just 0.2%. Put simply, the cost of hiring has risen much more than each worker's output.
Gemines interprets this difference as pushing companies to use less labor or replace it with machinery and technology. It attributes some of the pressure to the increase in the minimum wage, shorter working hours and higher pension contributions. This is the consultancy's interpretation: the comparison does not allow the impact of each measure to be quantified.
For job seekers, the message is direct. Even if the economy grows by more than 3% in 2027, Gemines estimates that unemployment will remain above its pre-pandemic levels for an extended period. So far, no other media outlet has confirmed the report's contents.
