View from the Ground
A change in government initially brought with it a wave of optimism among Brazilian employers. However, the lack of initial traction has tempered this enthusiasm and GDP growth downgrades have followed. Despite this, we are seeing positive momentum in the skilled labour market, with a number of major projects being undertaken, indicating an underlying confidence in the near future. In general, candidates are taking a more considered approach before moving jobs and businesses are offering more balanced opportunities. This has resulted in a slowdown in wage growth for high-skill occupations. Furthermore, changes in labour regulations are now starting to take effect as Brazil becomes more comfortable with what they mean in practice. As such, a closer equilibrium can be seen that will support employment growth as macro conditions gain momentum.
Jonathan Sampson, Managing Director, Hays Brazil
Key Skills in Demand
- Chief Finance Officers
- IT Scrum Masters (Dev Team Facilitator)
- Rewards & Benefit Specialists
- Purchasing Managers
- Regional Sales Managers
GDP rose by just over 1% in 2018, as the economy continued its slow recovery following the severe recession of 2015-2016.
The unemployment rate fell to 12.5% in 2018. However, most of the jobs created in the past year have come from the informal. This brings with it concerns about its potential to reverse the recent fall in income inequality and dilute the tax base. The appetite for hiring in the formal sector is still being hit by the lack of certainty in Brazilian politics. Jobless rates are also far higher among young people, women and Afro-Brazilians.
In the medium term, the unemployment rate is expected to gradually fall and labour productivity to slowly rise due, in part, to increased flexibility in employment contracts. GDP growth is expected to accelerate to over 2% annually over the next five years.