In 2023, Brazil celebrated a significant milestone with over 100 million people employed, the highest number since data collection began in 2012. This achievement showcases the country’s economic recovery and successful post-pandemic strategies, as reported by IBGE.
With an employment rate of 57.6% by the end of the year, Brazil demonstrated a robust job market. The formal job contracts also reached a record high of 37.6 million, improving job security and benefits for workers nationwide.
Despite these advancements, the unemployment rate dropped to 7.8%, the lowest since 2014, mainly due to job growth outpacing the number of job seekers. However, job gains were not evenly distributed amongst sectors, with services thriving while agriculture and industry lagged.
As the country entered 2024, the informal employment rate stabilized at around 40%, revealing persisting challenges in productivity and limited social benefits for workers, impacting their stability and quality of life.
While the government has made efforts to address these issues, informal employment continues to hinder economic productivity and tax revenue collection, particularly in urban areas like São Paulo and Rio de Janeiro.
With the federal minimum wage at R$1,412 monthly (approx. $259) significantly lower than the median salary of R$7,480 ($1,373), many face financial strain, as living costs surpass earnings, especially in major cities where basic expenses can exceed R$3,700 monthly (approximately $679).
Background
Over the last decade, Brazilians have experienced a nearly 50% reduction in purchasing power, as rising prices outpace wage growth. Inflation measures such as IPCA have surged by 88%, while average annual income has only seen a 3% increase. This disparity has led to affordability challenges for many, with monthly budgets struggling to keep up with escalating living costs.