Demand for Jobs Rises as Unemployment Rate Reaches 8.7 Percent

10/30/2015 - 09h02

With a record high demand for jobs in a market struggling to create openings, 8.8 million people in the country were unemployed between June and August (2 million more than what was reported for the same period in 2014), bringing the unemployment rate to 8.7 percent.

The rate is the highest recorded by the national employment study led by the IBGE (Brazilian Institute for Geography and Statistics), which began gathering data in 2012.

The demand for jobs rises when the buying power of families is lower, with rising inflation and lower income. This leads more family members to seek employment to supplement the household income.

The newly expanded profile includes youth who were dedicated to their studies, elderly individuals who have postponed retirement, women who had been separated from the job market as well as heads of household who lost their jobs.

Job cuts primarily took place in the industrial sector and construction, where positions have the highest formalization index and the best salaries. The two sectors laid off 694 thousand people in a year.

Part of those laid off sought employment informally. Self employment (salesman, painter, mason, for example) rose by 4.4 percent in one year (929 thousand more people).

"These are people who start a business with money from insurance-unemployment, from the FGTS (Employee Indemnity Guarantee Fund). But, what's going to happen when the benefits run out?", says Cimar Azeredo, coordinator at IBGE.

Eduardo Velho, lead economist at fund management firm NVX Capital Asset, said that the unemployment rate was expected to improve during this period, with temporary contracts, but that isn't happening.

Translated by SUGHEY RAMIREZ

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