Country Listing

Brazil Table of Contents


Employment and Earnings


Since World War II, the level of employment in Brazil has coincided generally with the expansion of the country's labor force. However, there have been considerable changes in the occupational structure (see fig. 7). The period from 1950 to 1970 witnessed slow growth in agricultural employment and a rapid increase in typically urban occupations, notably commerce and services but also industry (manufacturing, construction, and mining). The period from 1970 to 1980 was one of very rapid growth in employment, led by industry, resulting from a decade of marked economic expansion. The period between 1980 and 1990 saw an expansion of employment, led by segments of the services sector, despite the sluggish economy.

In the 1950-70 phase, the employed population went from 17.1 million people to 29.6 million, increasing at a 2.7 percent annual rate, similar to the rate of population growth. This expansion was led by the services sector, with 4.6 percent annual growth. Industrial employment also expanded significantly, with 3.9 percent annual growth. However, industrial labor expansion was quite a bit slower than the sector's growth in real product in the period (7.9 percent annually). In turn, employment in the primary sector experienced only a small increase of 1.3 percent annually, much less than the sector's growth in real product in the period (4.5 percent annually). In the 1950s and 1960s, the output elasticity (see Glossary) of employment was very small, not only for agriculture but also for industry, the economy's dynamic sector.

The share of agriculture in total employment fell from almost 60 percent in 1950 to 44.3 percent in 1970, that of the industrial sector increased from 14.2 percent to 17.9 percent, and that of the services sector increased from 25.9 percent to 37.8 percent. Another change in the period was the increase in the number of women in the labor force, from 13.6 to 18.5 percent. The male participation rate declined from 80.8 to 71.8 percent.

The 1970-80 period saw very rapid economic expansion. In the 1970s, GDP grew 8.7 percent annually; industry, 9.5 percent; and agriculture, 4.4 percent. In the same period, the employed population increased 3.9 percent annually, from 29.6 million to 43.9 million persons. This time, the expansion in total employment was led by industry, with a 6.7 percent annual growth rate. The services sector's labor force grew 5.9 percent annually. As a result of conservative modernization, agriculture's labor force experienced a small reduction, from 13.3 million persons in 1970 to 13.0 million in 1980.

By 1980 the share of agricultural employment had fallen to 30.1 percent, that of industry had increased to 23.9 percent, and that of the services sector, to 46.0 percent. The number of women in the labor force continued to increase, from 18.5 percent in 1970 to 27.4 percent in 1980; the male participation rate changed little, from 71.8 to 72.4 percent.

During the 1980-90 period, total employment increased, despite the sluggish economy. Between 1981 and 1990, the average rate of GDP growth was only 1.6 percent annually; industry averaged only 0.5 percent annual growth; agriculture, 2.6 percent; and the services sector, 2.7 percent. Total employment, however, increased 2.8 percent annually, from 43.9 million to 62.1 million persons. The average rate of unemployment in the period jumped from around 4 percent in the still prosperous years of 1979 and 1980 to more than 6 percent (average for the nine major metropolitan regions) in the depressed 1981-84 period; thereafter, it declined, falling to 3.6 percent in 1986. However, even with the return of stagnation, open unemployment increased only slightly.

Despite a decline of 4.0 percent in GDP, the unemployment rate was only 4.3 percent in 1990, as opposed to 7.9 percent in 1981. Meanwhile, an extensive informal economy (see Glossary) expanded, acting as a cushion and absorbing a growing number of people that the formal sector failed to employ. The informal sector included not only large numbers of street vendors, peddlers, and providers of petty services but also large numbers of middle-class workers as artisans, self-employed agents, and backyard business operators. Moreover, established businesses used the informal sector as a means of avoiding taxes, increased regulations, and the costs associated with being registered as employed.

Brazil lacks precise data on informal-sector employment, but there are indications of its expansion since 1980. For instance, between 1980 and 1990 the share of employees in the total employed urban labor force fell from 78.7 percent to 74.6 percent, and the share of the self-employed (many in the informal sector) rose from 17.2 percent to 19.1 percent. Furthermore, the proportion of workers with formal labor contracts declined considerably in most urban economic segments. This was certainly true in areas where the informal sector traditionally has prevailed, such as personal services, entertainment, construction, and commerce; but, it was also true in the more organized sectors, such as manufacturing.

In the 1990-92 period, the economy deteriorated further, with a 1.3 percent annual decline in GDP and 4.1 percent decline in industrial output. Agriculture grew only 1.5 percent, and the services sector, only 0.4 percent annually. The overall unemployment rate increased from 3.4 percent in 1989 to 4.3 percent in 1990, 4.2 percent in 1991, and 5.8 percent in 1992. The labor absorption by the informal sector continued to be large and highly visible.

In 1992 the share of agriculture in the country's employed labor was 9.4 percent and that of industry, 16.0 percent. As a result of the swollen informal sector, employment in the services sector increased to 57.4 percent. The female participation rate continued to increase, from 27.4 percent in 1980 to 38.9 percent in 1990. In 1990 women made up 35.5 percent of the labor force compared with 15 percent in 1950. The male participation rate increased from 72.4 to 75.3 percent between 1980 and 1990.

Data as of April 1997

Country Listing

Brazil Table of Contents