Brazil creates 306 thousand formal vacancies in February – 03/27/2024 – Market

Brazil generated 306,111 formal job vacancies in February, according to data from Caged (General Register of Employed and Unemployed) released this Wednesday (27) by the Ministry of Labor and Employment.

The number easily exceeds the consolidated result recorded in February last year, when 252,487 formal jobs were opened in the country.

In the annual comparison, in February this year, the net creation of vacancies was 21.2% higher than in the same month of 2023.

In total, in the second month of this year, 2.249 million hirings and 1.943 million dismissals were recorded.

With the change in methodology, analysts warn that it is not appropriate to compare the numbers with results obtained in years prior to 2020.

The five sectors of economic activities had a positive balance in February, with the biggest boost in the services sector – 193,127 formal jobs. There was also a net creation of 54,448 jobs in industry, 35,053 jobs in construction, 19,724 in commerce and 3,759 in agriculture.

On the eve of the new announcement, members of the government of Luiz Inácio Lula da Silva (PT) were already reflecting on the strength of the Brazilian job market. Since the beginning of the year, 474,614 formal jobs have been created in Brazil.

In an interview with Itatiaia radio, this Wednesday morning, Minister Fernando Haddad (Finance) said that the number of job creation in February would be “quite significant”. “The Brazilian economy is beginning a long cycle of economic growth and we need to prepare our youth to fill these jobs,” he said.

Minister Rui Costa (Casa Civil) stated, a day earlier, in a press conference with journalists at Palácio do Planalto that the Caged data would be “extraordinary”.

Of the five sectors of economic activity, four had a positive balance in the first two months of 2024. The services group helped boost the year’s result, with the creation of 268,908 formal vacancies. Next come industry (120,004 jobs), construction (81,774) and agriculture (25,751). In commerce, there was a negative balance of 21,824 formal jobs.

The strength of the job market has been sounding a warning for the Central Bank and for the prospects for the pace of cuts in the basic interest rate (Selic) ahead.

In the minutes of the last Copom (Monetary Policy Committee), released on Tuesday (26), the collegiate recorded an extensive discussion on the resilience of the labor market and its potential impacts on economic activity and inflation.

“It was noted that a tighter labor market, with salary adjustments above the inflation target and without corresponding productivity gains, could potentially slow down the convergence of inflation, notably impacting inflation in services and more labor-intensive sectors “, he said.

For Copom, the evolution of the indicator that measures the difference between the economy’s potential and actual growth (product gap) and the behavior of the labor market will be very relevant to determine the speed with which inflation will reach the target (3% ).

Last month, the average admission salary fell to R$2,082.79, a real reduction (discounted for inflation) of R$50.42 compared to January (R$2,133.21) – a negative variation of around 2.36%. Compared to February of the previous year, there was a real gain of R$28.29 (an increase of 1.4%).

In 24 of the 27 federation units, positive balances were recorded. The main result was seen in São Paulo, with the creation of 101,163 formal vacancies (an increase of 0.7%), with emphasis on the services sector (a total of 67,750 positions).