Brazilian formal labor market extends positive streak to 11 months

The Brazilian economy added 135,500 new formal jobs in November, according to Labor Ministry data. If, on the one hand, the result marks the 11th consecutive month of positive job creation numbers in the country, on the other hand, the figure was once again below market expectations.

Between January and November, 2.4 million jobs were created in the country, a drop compared to the same period last year, when 3 million jobs were added. However, in a press conference this Wednesday morning, Labor Ministry secretaries highlighted that Brazil set a new record for the total number of active formal employment relationships last month, which reached 43.1 million. 

The department also pointed out that even though the average entry wage has fallen for the third consecutive month in November, dropping 1 percent in a month to BRL 1,919 (USD 364), there was an increase regarding the BRL 1,884.48 registered in the same month a year ago. For that reason, the secretaries saw the current figure as “relatively good.”

Despite the lower-than-expected volume of new jobs for the month and falling wages, the numbers for the overall labor market — which also take informal and self-employed workers into account — have been improving since the beginning of the second half of the year. In the three months ended in October, unemployment in the country was at 8.3 percent, the lowest level since the quarter ending May 2015. 

This is due to a combination of the complete reopening of the economy after the pandemic and a recent slowdown in inflation, albeit short-lived. And results for Q4 should remain positive, especially considering the end-of-year festivities that usually bring good numbers to retail and services, boosting temporary hirings. 

This seasonal improvement already appears in data released this Wednesday by the Labor Ministry. Formal job creation in November was driven by the retail (106,000) and services (92,200) sectors, while industry (-25,700) and agribusiness (-18,200) presented the sharpest drops.

Regarding the Brazilian regions, the only one that did not present an increase in the creation of new jobs was the Center-West, which presented stable numbers in the month instead.

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