Brazil’s Jobless Rate Falls to 14.3%, First Decline This Year

RIO DE JANEIRO, BRAZIL – Brazil’s unemployment rate fell unexpectedly to 14.3% in the three months through October, official figures showed on Tuesday, December 29th. This was the first decline this year, as the number of people with jobs rose by almost 2 million from the prior three month period.

The 14.3% unemployment rate was down from a record 14.6% in the three months to September, statistics agency IBGE said, and lower than the median forecast of 14.7% in a Reuters poll of economists. The jobless rate ended last year at 11.0%.

Formal job growth has hit record levels recently as Latin America’s largest economy recovers from the worst of the COVID-19 pandemic. Tuesday’s data gave the first sign that the broader labor market, including millions of informal workers, may be returning to health as well.

The IBGE figures showed 84.3 million Brazilians had work, up 2.8% from the May-July period but still down 10.4%, or 9.8 million people, from the same period last year.

The workforce of 98.4 million people was up more than 3 million from the three months through July, and the number of people who were entirely out of the workforce fell by almost 2 million to 77.2 million, IBGE said.

“We saw a reduction in the number of people out of the workforce and this may have been reflected in more people absorbed by the labor market, as well as rising demand for work,” said IBGE researcher Adriana Beringuy.

Compared with a year ago, however, there are almost 10 million fewer Brazilians with jobs and 12 million more who have left the workforce altogether, she added.

If the labor market cannot continue to absorb the millions of people returning to look for work, the unemployment rate could push back up again to new record highs.

Less than half the working population, about 48%, have a formal job, IBGE said.

The number of Brazilians officially unemployed in the three months to October stood at 14.1 million people, IBGE said, up by almost 1 million, or 7%, from May-July and 13.7% higher than a year ago. The number of underemployed was largely unchanged at 32.5 million people from May-July, IBGE said.

Source: Reuters