Brazil’s unemployment rate reached 5.4 percent in the quarter ending in October – the lowest recorded by the statistics bureau IBGE since 2012. The period also ended with a record number of people with formal employment and average worker income. The data were released Friday (Nov. 28).

Survey highlights include:

• Unemployment in the quarter ending in October fell to 5.4 percent. In the previous moving quarter ending in September, it stood at 5.6 percent. In the quarter ending in October 2024, the rate was 6.2 percent.
   
• The highest rate ever recorded was 14.9 percent, reached in two periods – in the moving quarters ending in September 2020 and March 2021, both during the COVID-19 pandemic.
   
• The number of unemployed reached 5.910 million – the lowest number in the historical series. This total represents a drop of 11.8 percent (788 thousand fewer people looking for work) compared to the same quarter of 2024. The total number of employed people stood at 102.5 million, a record high.
   
• The total number of employed people with formal contracts reached 39.182 million, another record in the survey.
   
• Total payroll – the increase in income and the growing number of employed people meant that the total income of workers reached a record BRL 357.3 billion, a five-percent increase in one year.

High interest rates and maximum income

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IBGE’s Household Survey Coordinator Adriana Beringuy points out that income acts as a stimulus to the economy, counterbalancing high interest rates, which make credit more expensive and tend to slow down the economy. “Having this income at high levels has an influence on consumption,” she says.

The Brazilian economy’s benchmark interest rate – the Selic – stands at 15 percent per year, the highest level since 2006. This is an effort by the Central Bank to curb inflation, which has been above the government’s target of 4.5 percent for 13 months.

Sectors

Of the ten activity groups surveyed, two saw an increase in employment – construction (2.6 percent, or 192 thousand more people) and public administration, defense, social security, education, human health, and social services (1.3 percent, or 252 thousand more people). The only sector to see a decline was classified as other services (2.8 percent, or 156 thousand fewer people).

Labor market

The survey assesses labor market behavior for people aged 14 and over and takes into account all forms of employment – whether formal or informal, temporary or self-employed, for example.

According to the institute’s criteria, only people who actively sought employment in the 30 days prior to the survey are considered unemployed. A total of 211 thousand households are visited across all Brazilian states plus the Federal District.

Informality

In the quarter ending in October, the informality rate – the proportion of the employed population not benefiting from labor rights – stood at 37.8 percent, representing 38.7 million informal workers. This is the same level as in the quarter ending in July and the previous moving average, and below the 38.9 percent recorded in the quarter ending in October 2024.

Ministry of Labor and Employment

The survey was released the day after another labor market indicator was prepared by the Brazilian Ministry of Labor and Employment, which only tracks formally registered employees.

In it, October saw a net increase of 85,100 formal jobs. Over 12 months, the balance is positive at 1.35 million formal jobs.