Communications segment loses space in the services sector

The information and communication segment has lost share in the country’s services sector in 10 years. In 2013, this segment was predominant in the gross revenue from services of 14 states and, in 2022, it did not prevail in any of them. The data are from PAS (Annual Survey of Services) and were released on August 28 by IBGE (Brazilian Institute of Geography and Statistics).

This segment’s retraction is mainly related to the performance of one of its 5 activities. “One of the reasons for this was the loss of revenue from telecommunications, which is made up of telephone companies. We observed a change in behavior among people who stopped using the telephone as a way of communicating and started using the Internet more, with messaging applications.”explains research analyst Marcelo Miranda.

On the other hand, in 2022, the professional, administrative and complementary services segment was predominant in the gross revenue from services of most (22) UFs (federation units). In 2013, this sector predominated in 10 UFs.

The total estimated gross revenue collected by companies providing non-financial services was R$3.1 trillion, with 97.4% of this total generated by the service provision activity and the remainder by the secondary activities of these companies, which include industrial, construction and merchandise resale operations.

The loss of share of the information and communication segment also occurred in the net operating revenue (NOR) of services, when canceled sales, unconditional discounts and applicable taxes are subtracted, estimated at R$2.7 trillion in 2022.

“At the beginning of the historical series, in 2007, this segment was the most relevant. It corresponded to 31.2% of the net operating revenue in the country’s services sector and has been gradually falling since then. During the pandemic, it remained stable from 2019 to 2020, but has been falling little by little in the following years.”highlights the researcher.

It was a movement similar to that of the telecommunications activity itself, which, in 2013, had a 13.4% share in the generation of ROL (Net Operating Revenue), the largest among activities, and has fallen 6.7 percentage points (pp) since then.

In 2022, the information and communication segment represented 19.4% of the ROL, ranking 3rd in terms of share, behind Transport, auxiliary transport services and mail (29.8%) and professional, administrative and complementary services (27.8%).

“At the beginning of the historical series, the Transportation, auxiliary transportation services and mail segment represented the second largest share of net operating revenue among the seven segments and remained stable over the years. With the decline in information and communication services, the other segments did not gain much share and it remained in first place because of this stability”, explains.

Analyzing the 34 activities belonging to the 7 major service segments, the information technology sector, which is also part of information and communication services, was the one that had the greatest gain in share in 10 years (3.4 pp). In the same period, road freight transportation grew 2.5 pp, which elevated it to the activity with the largest share in net operating revenue (13.1%).

“This is a question of our infrastructure culture. We use road transport a lot to transport cargo, using trucks. The country’s road network is very extensive and this has influenced the growth of this activity over the last 10 years.”evaluates Miranda.

In services provided mainly to families, there was a concentration in revenue generation essentially in two of the five activities: food services (64.7% of revenue generated in this segment); and accommodation services (13.7%). The segment was the 4th with the largest share of revenue (10.7%).

With 14.2 million people, employment in services reaches record in 2022

In 2022, there were 1.6 million non-financial service providers active in the country, employing 14.2 million people. This contingent grew 5.8% compared to the previous year and was the largest ever recorded in the PAS historical series. Companies paid R$518.0 billion in salaries, withdrawals and other remunerations.

With the growth in employment, employment in the sector was 10.3% above the pre-pandemic level, which represents an increase of 1.3 million employed people compared to that recorded in 2019. This growth was especially influenced by the professional, administrative and complementary services segment, with emphasis on the activities of technical-professional services (353.8 thousand), office and administrative support services (248.3 thousand) and selection, agency and labor leasing (203.7 thousand).

On the other hand, there was a drop of 92,400 people employed in services provided mainly to families during this period, with the impact of the retraction in food service activity (-112.5 thousand people).

“Services provided mainly to families include, for example, food services and accommodation services. During the pandemic, these activities that are closely linked to the in-person aspect, such as restaurants and hotels, ended up losing employees in a very intense way. And, although they have grown in the last 2 years, they have not yet managed to reach pre-pandemic levels”, highlights.

Over a 10-year period, the publication showed an increase of 1.7 million people employed in the non-financial services sector as a whole. This was an increase of 13.9%, particularly impacted by technical-professional services (508,000) and office and administrative support services (393,500). Another notable sector was information technology (244,600).

In the opposite situation, road passenger transport lost 213.2 thousand employees in 10 years, the biggest drop among activities. A possible explanation for this result is the decrease in demand for some professions in the sector.Before, you had the figure of a ticket collector on municipal buses, for example, which is much less present nowadays.”he observes.

In 2022, workers in the non-financial services sector were concentrated especially in professional, administrative and complementary services (6.2 million), services provided mainly to households (2.8 million), transport, auxiliary transport services and mail (2.6 million) and information and communication services (1.3 million).

Among the 34 activities disaggregated, food services was the one that employed the most, accounting for 11.6% of those employed. Next came technical-professional services (11.4%), road freight transport (8.4%), services for buildings and landscaping activities (8.2%) and office and administrative support services (7.7%). These 5 activities accounted for almost half (47.3%) of the jobs in the sector.

Medium size is larger in companies in the transport sector

Still regarding employment in the non-financial services sector, the publication calculates the average size of companies, measured by the ratio between the number of people employed and the number of companies. In 2022, there was an average of nine people per company, which indicated stability compared to 2013, when this average was 10 people.

The activities of some segments had much higher averages, such as transport, auxiliary transport services and mail: rail and metro-rail transport (952 people), pipeline transport (551 people) and air transport (223 people). The sectors linked to real estate activities and maintenance and repair services had the lowest average size values ​​(between 2 and 4 people per company).

The average salary in the services sector was 2.3 (minimum wages). The companies that paid the highest averages were in the transport, auxiliary transport services and mail segments: pipeline transport (18.5 minimum wages), water transport (6.9 minimum wages) and air transport (6.1 minimum wages).

The lowest average wages were paid in cultural, recreational and sports activities, with 1.3 msm, and food services, services for buildings and landscaping activities; purchase, sale and rental of own property, maintenance and repair of vehicles and maintenance and repair of personal and household objects, which tied with an average wage of 1.4 msm

Services sector reaches lowest level of concentration in historical series

Another indicator that the publication brings to analyze the services sector is the analysis of market concentration. The R8 concentration ratio (order 8), used by the survey, calculates the proportion of net revenue captured by the 8 largest companies in the sector. The higher the R8, the higher the concentration. In 2022, the R8 was 6.8%, a drop of 2.7 pp in 10 years, which represents the lowest concentration value in the survey’s historical series.

“The services sector has been growing more and more and, with the increase in the number of companies, large companies end up losing some of their share to smaller ones. This fragmentation of service activities may explain this reduction in concentration”says the analyst.

The largest concentration was in the information and communication services segment, with R8 of 30.8%, although it showed the largest drop from 2013 to 2022 (-5.1 pp). The other segments with the largest concentrations were other service activities (26.3%), transport, auxiliary transport services and mail (12.7%), maintenance and repair services (11.5%), services provided mainly to families (8.2%), real estate activities (7.2%) and professional, administrative and complementary services (5.5%).

Among the 34 activities that make up the services sector, the highest levels of market concentration were in the Transport, auxiliary transport services and mail segment: pipeline transport (100.0%), air transport (94.4%), mail and other delivery activities (82.5%) and rail and metro-rail transport (76.9%).

Southeast accounts for 65.4% of gross service revenue

Over the past 10 years, the composition of gross revenue from services in relation to the major regions remained practically stable, with an increase of 0.4 pp in the South, and 0.1 pp in the Central-West and Southeast. The Northeast (-0.6 pp) and North (-0.2 pp) saw a decrease. As a result, the Southeast accounted for 65.4% of the total revenue. The other regions had the following shares: South (14.7%), Northeast (9.8%), Central-West (7.4%) and North (2.6%).

The Northeast concentrated 15.1% of those employed in the country’s service sector in 2022, but accounted for only 10.7% of wages paid. The Southeast concentrated 56.4% of those employed and 64.7% of wages.

The Northeast also has the lowest remuneration paid to employed workers in the entire historical series of the survey, when compared to other regions. In 2022, the average salary was 1.6 minimum wages, while the national average was 2.3 minimum wages in the sector. The Southeast paid the highest remuneration (2.7 minimum wages), followed by the South (2.1 minimum wages), Central-West (1.9 minimum wages) and North (1.8 minimum wages).

With information from IBGE Agency.