EMPLOYMENT: 59% of Brazilian cities had a positive balance of formal employment contracts in June

In the last 12 months, the job balance was 1.72 million, an increase of 4% compared to the same period of the previous year. The result for the first six months of 2024 was 1,283,046, an increase of 25% in the balance compared to the first half of 2023.

The president of the Union of Economists in the State of São Paulo (SINDECON-SP), Carlos Eduardo Oliveira Junior, attributes the confidence of businesspeople to the increase in employability in the country.

“This significant improvement is undoubtedly related to confidence. The confidence of businesspeople in investing, given that consumption is rising and this automatically generates jobs, because you have to increase production. By increasing production, you necessarily have to hire new professionals. This makes the economy, as a whole, rise at this time.”

The CNM survey also shows that the number of formal jobs reached its highest level in the historical series in June, with 46.8 million regularized jobs. The increase was 0.4% compared to May; 3.8% compared to June 2032 and 3.5% in the last 12 months.

For economist Carlos Eduardo, the increase in formal jobs is due to the increase in production. “In other words, you increase production if you know that you are going to sell this production. But if you are going to sell this production, you need to produce more. It will generate more jobs, hire more people and, sometimes, even people who were working informally see this improvement and move to the formal market; either doing what they are doing or (changing) for a better job.”

Sectors

Also according to the CNM survey, 76% of the balance of jobs generated in the first six months of 2024 are related to:

• Services (37%): emphasis on service, agency and labor leasing; office, administrative and other services provided to companies; and human health and social services;
• Construction (4%): emphasis on works; specialized construction services; and building construction;
• Trade (20%): wholesale and retail;
• Industry (15%): emphasis on vehicle manufacturing; food products; and clothing and accessories.

Professor José Luiz Oreiro, from the Department of Economics at the University of Brasília (UnB), highlights that the country is starting to build again.

“The country is starting to build again, but it is mainly infrastructure projects, carried out by states and municipalities. In other words, investment by states and municipalities, by state and municipal governments, has increased significantly in the last 18 months, largely due to the fiscal adjustment that subnational entities made in the 2021-2022 period, in which there was no salary adjustment for public servants. This created space in the budget for increased investment.”

Regions

All regions of the country showed an increase in the job stock in June 2024, according to the CNM. The largest monthly variation, compared to June 2023 and in the last 12 months, occurred in the North Region, where growth was 0.8%, 5.4% and 4.9%, respectively. The smallest variations occurred in the South Region, with increases of 0.2%, 3.1% and 2.7%, respectively.

Growth rate of the stock of occupations by geographic region

Source: New CAGED/MTP. Prepared by: Department of Technical Studies/CNM

For economist Carlos Eduardo, the election year contributes to an increase in hiring, especially in small and medium-sized cities in the North and Northeast regions.

“This is an election year, when you see greater production and hiring by mayors, because they have things to do, they have to show their worth, they have to pave the streets, they have to clean, they have to take care of the city’s maintenance. With that, you will have to hire people to do these activities. There is also the issue of health, with the community outreach, and that is where the need to hire people arises.”

Regarding the moderate growth of jobs in the South Region, professor José Luiz Oreiro attributes it to the floods that occurred this year in Rio Grande do Sul.

“The floods in Rio Grande do Sul have had a major impact on the state, industry and agricultural activity. This has certainly had a negative impact on income and employment generation in the state of Rio Grande do Sul.”

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For the second half of 2024, economists are optimistic:

“The expectation for the second half of the year is that this market will remain somewhat buoyant. It may even reach 2 million jobs created by the end of the year,” assesses the president of SINDECON-SP, Carlos Eduardo Oliveira Junior.

“The unemployment rate is very low, real wages are growing, and that is what everything indicates. Therefore, household consumption spending will continue to grow and, therefore, create demand. And it is the creation of demand that generates the creation of income and jobs. Therefore, the outlook is very good for the second half of 2024”, expects José Luiz Oreiro, professor of the Department of Economics at UnB.