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Brazil’s economic war against coronavirus presents many pitfalls

. Aug 24, 2020
Brazil's economic war against coronavirus presents many pitfalls Father and son in Rio de Janeiro favela Complexo da Maré. Photo: Fabio Photos/Shutterstock

While Jair Bolsonaro’s economic team has yet to lay out its plans for a direct wealth-transfer policy to replace the coronavirus emergency salary, labor market data from the Brazilian Institute of Geography and Statistics (IBGE) gives an idea of the challenges the government will face in post-pandemic Brazil. Being paid to the unemployed, informal workers, individual micro-business owners, and beneficiaries of the Bolsa Família program, the emergency salary reached 44 percent of Brazilian households in July, according to the National Household Sample Survey Covid-19 (PNAD Covid-19). In May, 38 percent of homes had access to the program.

The survey is the third in a special series which began in May, using experimental statistics to measure the impact of the pandemic on the labor market and demand for health facilities. 

</p> <p>Between May and July, there was an increase of approximately <a href="https://brazilian.report/power/2020/08/24/how-bolsonaro-deflected-blame-for-coronavirus-debacle/">2 million unemployed</a> people in Brazil, bringing the total up to 12.2 million. In this same period, another million Brazilians left the workforce — i.e., they are unemployed, but are also not seeking work. A stunning 76.5 million Brazilians were in this situation in July — over one-third of the total population — and over 19 million of them had stopped looking for employment due to either the coronavirus or the <a href="https://brazilian.report/latin-america/2020/07/27/understanding-latin-america-wave-informal-employment/">lack of opportunities</a> in their place of residence.</p> <p>According to survey coordinator Maria Lúcia Vieira, the increase in the number of discouraged workers did not come as a result of the population outside the workforce returning to look for work and putting pressure on the labor market. &#8220;Between May and July, the total workforce fell by 3 million people. A large part of the increase of discouraged workers is to do with a general dip in employment and not the re-entry of those who were not looking for work,&#8221; she explained, during a press conference.</p> <div class="flourish-embed flourish-map" data-src="visualisation/3559270"><script src="https://public.flourish.studio/resources/embed.js"></script></div> <h2>Coronavirus crisis: regional differences</h2> <p>The emergency aid&#8217;s ability to <a href="https://brazilian.report/society/2020/07/30/coronavirus-aid-brazil-poverty-rates-drop-lowest-level-since-2004/">reduce poverty levels</a> at a time when the labor market is unable to respond to the Covid-19 crisis has helped boost Jair Bolsonaro&#8217;s <a href="https://brazilian.report/newsletters/brazil-daily/2020/08/14/despite-pandemic-mismanagement-bolsonaro-approval-ratings-go-up/">popularity numbers</a>. The president&#8217;s approval is also rising in the Northeast region of the country, which is the poorest part of Brazil and the only area in which Mr. Bolsonaro lost the 2018 election.</p> <p>The link to the emergency aid is crystal clear in this instance. While only 30 percent of households in the South region receive the monthly aid payments, this percentage reaches 60 percent in the North and Northeast.</p> <p>In the northern state of Amazonas, where a whopping 50 percent are in informal employment, 62 percent of households received the government&#8217;s coronavirus salary. Roughly 17 percent of the state is unemployed, the four percentage points above the national average.</p> <p>Meanwhile, in the neighboring state of Amapá, when the emergency salary program inevitably comes to an end, 68 percent of households will be left out of pocket.</p> <div class="flourish-embed flourish-map" data-src="visualisation/3559188"><script src="https://public.flourish.studio/resources/embed.js"></script></div> <div class="flourish-embed flourish-map" data-src="visualisation/3559146"><script src="https://public.flourish.studio/resources/embed.js"></script></div> <div class="flourish-embed flourish-map" data-src="visualisation/3559027"><script src="https://public.flourish.studio/resources/embed.js"></script></div> <p>

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Aline Gatto Boueri

Aline Gatto Boueri is a data journalist. She has had her work published by Gênero e Número, Universa UOL, Marie Claire, Projeto Colabora, among others.

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