Services sector posts worst performance on record in 2020

services Tourism sector was one of the hardest-hit
Tourism sector was one of the hardest-hit by the pandemic. Photo: Catarina Belova/Shutterstock

The Brazilian services sector crumbled 7.8 percent last year in what was its worst performance since records began in 2012. Pandemic-related restrictions crushed service segments that relied on the in-person economy, making it one of the areas worst hit by the coronavirus crisis. 

The results for 2020 came in even lower than the 5-percent plunge suffered in 2016, when Brazil was in the middle of what was its worst recession in history at the time, set to be bested by the current crisis. 

Unsurprisingly, the segments that suffered the most were those that are overly reliant on in-person activities, such as services to families (-35.6 percent) — which includes tourism, restaurants, and education services — professional and administrative services (-11.4 percent), and transportation (-7.7 percent). 

The only category that posted positive results in 2020 was the so-called “other services” segment (+6.7 percent), including financial services such as brokerages and stocks markets. It is believed Brazil’s lower benchmark interest rates contributed to growth in this area.