Indicator shows improvement in the labor market in Brazil; result surprises financial market analysts
The unemployment queue in Brazil decreased in early 2022. The official rate fell to the lowest level since 2016. It reached 10.5%. In other words, it returned to the level of the Dilma Rousseff (PT) government. The number surprised financial market analysts and gave a “gas” to the pre-campaign of Jair Bolsonaro, who fights in defense of his economic policy.
Numbers compiled by Power 360 show that the unemployment rate has been declining for 9 consecutive months. The total number of unemployed in the country (11.3 million) fell by 25.3% in the year. It means 3.8 million fewer unemployed people, who stopped looking for a job because they found an activity to do, be it work or study.
Currently, there are 96.5 million people employed, that is, working or in some other activity. The percentage has been rising for 12 consecutive months. Accumulate annual increase of 10.3%.
O IBGE (Brazilian Institute of Geography and Statistics) released the data on Tuesday (31.May.2022). Here’s the intact of the report (9 MB).
The gradual improvement in the job market, however, is accompanied by a drop in the population’s income, due to the increase in consumer prices.
The worker’s income was stable at R$2,569 in the quarter compared to the previous one (from November 2021 to January 2022). It dropped 7.9% compared to the same period last year. The historic low is December 2021 (R$ 2,541).
For economist Bruno Imaizumi, from LCA Consultantsthe April unemployment result “really surprised” driven by the growth of the employed population, spread among those with a formal contract and informal workers.
“The problem is that the unemployment rate today does not tell the whole story of the job market, as there are 3 million more people out of the workforce than in the pre-pandemic period. These people, by not looking for a job and not entering the unemployment statistics, are not counted in the unemployment rate”, stated.
That is, it is possible that the country has lower unemployment rates than before the crises (pandemic and recession of 2015-2016).
“This will not necessarily mean a better job market, since today we have an income at minimum levels and the proportion of informal occupations in the job market is increasing”, said Imaizumi.
Currently, there are 65 million people out of the job market.
UNEMPLOYMENT & ELECTIONS
Unemployment advanced with all presidents: in the Fernando Henrique Cardoso administration, in the 1st term of Luiz Inácio Lula da Silva, in the 2nd term of Dilma and with Temer.
The only times that unemployment fell at the beginning of the government 3 months before the elections were in Lula’s 2nd term (2006-2010) and in Dilma’s 1st term (2011-2014).
The percentage of unemployed should fall again with President Jair Bolsonaro (PL). In July of this year, the month before the beginning of the electoral campaign, the rate is expected to be below that recorded in December 2018 (11.7%).
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