Unemployment in Brazil
The rate of unemployment in Brazil is determined by the Monthly Employment Survey, coordinated by the Brazilian Institute of Geography and Statistics (IBGE). This research examines the economically active population (PEA) of the six largest metropolitan areas (São Paulo, Rio de Janeiro, Belo Horizonte, Porto Alegre, Salvador and Recife).
Definition of unemployment
The IBGE classifies as unemployed those who were not working, were available for work and had taken action to get work in the thirty days preceding the survey.
For research conducted between 1983 and 2002, the IBGE considered working age population (PIA), to be those over the age of fifteen. Under the new methodology the age limit was raised to eighteen. To be considered employed, the institute once set the threshold at 15 hours per week. The new study lowers that to one hour per week.
The highest unemployment rate registered since January 2002 was April 2004 (13.1%) and the lowest was December 2011 (4.7%). Only twice, in 2006 and 2009, did the rate rise in the previous year. At the end of 2013, the unemployment rate fell to a record low 4.3% in December from an already low 4.6% in November. This marks the lowest since the current version of the Brazilian unemployment rate was first reported in 2002. A comparison with the pre-2002 unemployment rate index suggested that was the tightest labor market since at least 1980.
Unemployment rate (%)
Brazil has a number of different unemployment systems that could help those who have just lost their jobs. First, Brazil has a system called FGTS, Fundo de Garantia por Tempo de Serviço, which enables a set of funds to be retrieved from companies and then given to Caixa Econômica Federal, one of Brazil's top banks. These funds are then used to support employees who recently became unemployed; this happens because the employer has to collect 8% of an employee's salary and then deposit it into their Caixa Econômica Federal account every month. Next, Brazil also has a system called Aviso Previo, which grants any employee the right to work for one last month after they are fired from a company, or receive the money they would have made in one months worth of work. Furthermore, if any employee has worked at least six months, they are eligible to apply for unemployment benefits. These unemployment systems, among various others, are available for the citizens of Brazil.
Unemployment and the Economy
With Brazil being the most populated country in South America, their economy has the potential to be one of the strongest in the world. However, with over 14 million Brazilians unemployed and unemployment rate hitting an all time high in 2017 at 13.6%, things aren't looking so good for Brazil's economy. In addition, Brazil recently voted Jair Bolsonaro as their president-elect, and he has plans to conduct business with other foreign nations such as the United States. With a new president in office who plans on conducting foreign business, it will be interesting to see how this affects the economy of Brazil and also the employment rates over the presidential term.
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