Census should change employment numbers – 06/28/2023 – Market

The IBGE Census (Brazilian Institute of Geography and Statistics) says that the Brazilian population was 203 million people in August 2022. In the most routine socioeconomic surveys by the IBGE, the population was estimated at around 214 million, in a month equivalent to that of last year. These are data from the monthly, quarterly and annual PNAD (National Household Sample Survey). According to the updated population projection of the IBGE in 2020, we would be almost 215 million last year.

The difference between Census and PNAD numbers may be relevant for thinking about some aspects of the world of work (the situation would be better than imagined) and the unemployment rate. There are 11 million fewer people, a difference of more than 5% in relation to the Pnads.

Furthermore, at least in the statistical review, the country has become richer (increased GDP per capita), although, of course, the number of people sleeping on the sidewalks or without food and decent wages remains the same.

Important: it was already clear that the country would need a lot of immigrant labor, especially with more qualifications, if the economy returned to growth. With these Census numbers, it looks like the need will be even greater. It will have to be a matter of state policy.

For the time being, with the data at hand, the new population numbers may indeed be of immediate relevance for thinking about employment.

For example, Census figures should trigger revisions to the labor force participation rate. That is, the proportion of people employed or looking for work in relation to the total population of working age (over 14 years old, according to IBGE statistics).

Economists Samuel Barbosa, a researcher at the Brazilian Institute of Economics (Ibre, FGV) and the Julius Baer Family Office (JBFO), and Daniel Duque, a researcher in the area of ​​Applied Economics at Ibre, FGV, agree with the assessment.

And? This rate should rise if there are no revisions in the number of people employed or looking for work. In theory, this could also result in a revision in the unemployment rate —it is not yet possible to know, with the available data.

In any case, it is possible to speculate, based on the available data, that the employment situation is, quantitatively, better: there are proportionally more people working.

As there is still no data from the new Census on the population by age group, one can only speculate about other changes in the interpretation of what is happening with employment in Brazil. For example, if the difference between the Census and the PNAD is greater among young people, it is likely that the unemployment rate will be lower than what is currently measured.

The decrease in the labor force participation rate after the epidemic is a subject that has been the subject of discussion by economists. This rate was 61.4% in the quarter ended in April, according to the monthly PNAD. In April 2019, before the epidemic, 63.6%. From when there are comparable data, 2012, until 2019, the average was 62.9%.

If the participation rate in April were the same as the 2012-2019 average, there would be an additional 2.6 million people in the labor force (either working or, more likely, looking for a job).

That number might say something about the unemployment rate. With fewer people looking for work and everything else constant, the unemployment rate drops, for example. This is what has happened this year.

The reason is a matter of debate. More people receiving a bigger Bolsa Família? Slight improvement in the situation of families, helping to take people out of the job market (even to study, for example)?

Finally, more people (in terms relative to the population) working may indicate a greater potential for economic growth.

As for the general situation of life, the question remains for demographers, sociologists, anthropologists or economists: why has population growth slowed so fast and is so low? Does the economic meltdown that started in 2014 have anything to do with it?