University of São Paulo Study Finds Brazil’s Unemployment Hits Lowest Rate Since 2014 in First Quarter
The unemployment rate was 7.5% in the quarter ending in April, according to IBGE data. Unemployment affects 8.2 million people. This was the best result for this moving quarter since 2014 (7.2%), and the number of workers with and without a formal contract set a record. Professor Hélio Zylberstajn, from the Faculty of Economics, Administration, Accounting and Actuarial Science at USP, explains the fluctuations in the Brazilian job market.
The professor points out that the results of the PNAD (National Household Sample Survey) published by IBGE are encouraging. “The interesting thing is to compare this quarter with the one before it. In this observation, we see that workers’ income grew 1.1% above inflation. If we maintain this rate, we will reach 5% growth this year, greater than GDP growth, which is expected to be around 2%.”
Agriculture and industry
The publication points out that the sectors that grew the most in employment were agriculture, public administration and industry. “Agriculture is under a seasonal effect, we are in the harvest phase. So agricultural companies are hiring for harvesting. Public administration suffers a huge impact at the beginning of the school year, we have the hiring of teachers, which naturally lifts the sector. The sector that surprised and grew without this seasonal effect was industry”, he explains.
According to the professor, the study indicates that we are reaching a limit in the expansion of the job market. “PNAD calculates a variable called participation rate. It works with the concept that the working age population are people between 14 and 64 years old. This rate this quarter was 62%. This is a historically low level of participation. Three hundred and sixty-five thousand young people entered working age this quarter. Therefore, it was expected that at least 200 thousand would enter the market, however, only 133 thousand entered. This means that there was a reduction in people looking for jobs, which also contributed to the drop in unemployment”, he concludes.