I had read a bit before about Venezuela’s socialist tendencies but this sort if explains why the economy would struggle:
As Venezuela grapples with economic turmoil and widespread protests, a law that effectively prohibits companies from firing workers continues to restrict the country’s ability to compete in the global economy.
This law apparently requires government permission before a business can fire someone… not hard to imagine the market forces tipping toward labor’s favor, putting pressure on businesses to increase production in the face of worker ambivalence. Why should workers care about doing a good job if they cannot be fired?
Those policies, particularly a strict 2012 labor law that requires companies to seek government approval for to fire employees, are weighing on Venezuela’s economy, said Diego Moya-Ocampos, senior Latin American analyst for IHS Global Insight.
Businesses are also being forced to limit workers’ hours to 40 a week, down from a previous cap at 44 hours.