Coming back from work is slower than looking for Bolsa Família – 06/05/2023 – Market

The resumption of formal employment has been slower in the post-pandemic period than demand for Bolsa Família in the North and Northeast regions of the country, according to a survey by DeltaFolha, which crossed records from the Transparency Portal, from the CGU (Controladoria-Geral da União) and the Ministry of Labour.

Data show that formal jobs in both regions have gradually grown. At the same time, the number of Bolsa Família beneficiaries jumped in 2022.

The movements, which differ from what is observed in the rest of the country, raise the alert for the mismatch between the number of people contributing to Social Security and those receiving State resources.

For comparisons, in addition to data from Bolsa Família, the stock of employment from Caged (General Register of Employed and Unemployed), which considers the number of people with a formal contract working in the private sector and in the public sector, was analysed.

Before and after the pandemic, in the Northeast, the number of beneficiaries of the social program jumped from 6.758 million in January 2020 to 9.773 million in January 2023 (an increase of 44.6%). The stock of formal jobs was 6.062 million and rose to 7.006 million (up 15.6%).

The difference between employees and those enrolled in the program has been growing in recent years, but it is from the beginning of 2022, a year after the start of vaccination in Brazil, that the difference between the two groups becomes more visible.

At that time, the government of former President Jair Bolsonaro (PL) had just replaced Bolsa Família, a trademark of PT governments, with Auxílio Brasil, in search of votes among low-income voters.

Bolsonaro ended up defeated at the polls and President Luiz Inácio Lula da Silva (PT) was elected for his third term, with the recreation of Bolsa Família, in March of this year, as one of his first measures.

The petista won in all northeastern states and in 3 of the 7 states in the North, in the second round of 2022.

From January 2022 to January 2023, participants in the income transfer program in the Northeast increased by 18.67%, while the stock of registered workers increased by 5.47%.

In the North, beneficiaries increased by 48.97%, from 1.701 million in early 2020, pre-pandemic, to 2.534 million in January of this year. For workers with a formal contract, the increase was 18.39%, from 1.726 million to 2.043 million in the same period.

In the region, there was also a detachment from last year: the demand for Bolsa Família grew 27.1%, while the stock of formal jobs increased 5.55%.

As a result, the difference between beneficiaries and CLT holders grew by 73.7% among Northeasterners and 243.1% in the North from 2022 to 2023.

The movement also shows a detachment in comparison with the rest of the country. In other regions, Bolsa Família beneficiaries and CLT employees have behaved similarly.

In the Midwest and Southeast, the difference between jobs and beneficiaries even dropped from January 2022 to January 2023: 0.8% and 2.9%, respectively. In the South, the difference was practically stagnant, growing by 0.3%.

“I came to save money, but I want to go back as soon as possible”, says Eunice de Castro, 22. Born in the interior of Bahia and the daughter of Bolsa Família beneficiaries, she left home early, in the east zone of São Paulo, and is waiting for his turn at an employment agency in the center of the city.

“The program is very important for those who need it most and it gave me the freedom to continue studying, to have a chance”, she says.

Economist Marcelo Neri, director of FGV Social (from the Getulio Vargas Foundation), recalls that the number of beneficiaries of Bolsa Família has increased significantly in recent years, reaching about half of the formal jobs reported in Caged.

“At the same time, another movement helps to explain this convergence: the number of self-employed workers went from 20 million to 25 million in ten years.”

Neri points out that the question that arises is how to fiscally support this scenario in which the portion of the population that receives public funds increases in some regions and municipalities more than the portion that contributes to Social Security and with taxes.

5 of the 10 areas of the country are in the Northeast where the difference between Bolsa Família beneficiaries and formally employed employees grew the most between 2022 and 2023.

The delimitation of these areas was carried out by DeltaFolha. The survey chose to divide the data into immediate geographic regions (sets of municipalities that have an urban center as a basis) instead of compiling data from cities only, to reduce distortions in comparisons between municipalities with populations of very different sizes.

São Vicente encourages MEI to work around the problem

This happened, for example, in São Vicente, on the coast of São Paulo. In the city, encouraging the formalization of self-employed workers was one of the alternatives to compensate for the impact that the closure of inns, hotels and restaurants caused in registered employment during the pandemic.

“We had an 84% increase in individual microentrepreneurs, compared to the pre-pandemic period. The person may not have a CLT job, but we want them to be able to open a business, undertake and maintain themselves”, says Fernando Paulino, Employment Secretary , Work and Income in the city.

He points out that the city hall has carried out formalization actions, especially aimed at women. “A branch that is heating up in São Vicente is beauty, we have been traveling around the neighborhoods to talk to entrepreneurs and I believe that self-employment is going to be the new reality for the whole country.”

The relative slowness in the recovery of formal jobs is related to the predominance of informality in certain regions, evaluates Flávia Santana Rodrigues, technical supervisor of Dieese (Interunion Department of Statistics and Socioeconomic Studies) in Sergipe.

“A good part of the occupations depend on the commerce and services sector, deeply affected during the Covid-19 pandemic, since most of these establishments had to remain closed during the most critical phase of the pandemic”, he says.

Rodrigues says he believes that the consolidation of Bolsa Família at R$ 600 and the auxiliary benefit of R$ 150 per child, which President Lula had already indicated in the campaign, should help to boost economic activity and the job market, especially in the Northeast .

Review of benefits should reduce number of beneficiaries

In 2022, on the eve of the election, the Bolsonaro government raised the then-Auxílio Brasil to R$600 until the end of the year. Elected, Lula kept the value, now again under the name of Bolsa Família.

By changing the rules of the program, the previous government also favored the artificial division of families and the program saw an explosion in the number of single-person households — formed by just one person. With the PT victory, the government has reviewed benefits granted irregularly.

In February, the Minister of Development and Social Assistance, Wellington Dias, stated that there were indications that 2.5 million families received the benefit improperly. “The brain of the Cadastro Único was dismantled. It’s as if there was a mess to lose control of.”

“We are looking for this recovery, Feira is a city strong in services and commerce and has more than 1,200 industries installed, in addition to having an important logistics area. We have 128 thousand enrolled in the Bolsa Família and some smaller municipalities are dependent”, says Colbert Martins Filho (MDB), mayor of Feira de Santana (BA).

“The expectation is for a reduction, there is an estimate that more than 30 thousand may be disconnected from the program by the government”, says Martins Filho, who also says that the maintenance of R$ 600 led to an improvement in the city’s construction sector, with the expansion of houses and construction of slabs.

Naércio Menezes Filho, a researcher at Insper and a specialist in the labor market and income distribution, believes that Bolsa Família works as a job inducer, contrary to the criticism that is usually made of the program.

“People consume, the revenue of small enterprises increases, the owners hire more and so on. Various studies show that the increase in Bolsa Família does not reduce the demand for work, there does not seem to be an accommodation effect.”

According to him, what seems to be happening in the mismatch between the number of beneficiaries and the recovery of the labor market is the decrease in formal employment in some municipalities, which can cause an increase in poverty and hunger.

“This has to do with the use of robots and machines that are replacing the work that was done by people at an intermediate level. A typical example is the call center sector in the Northeast, which hired a lot of people, had incentives and exemptions and now the machines are doing this service.”

In the metropolitan region of Aracaju (SE), the municipality of Nossa Senhora do Socorro is trying to circumvent the effects of the pandemic on the city’s job market, which was also affected by the drop in tourism.

According to the survey, the micro-region of Aracaju had 169,300 people enrolled in Bolsa Família in January of this year, compared to 219,500 formal jobs – and this difference has decreased year by year, since the pandemic.

The city hall created a free human resources program, which helps in screening resumes for vacancies in around 40 registered companies. At the time of the pandemic and Emergency Aid, when the benefit reached BRL 1,200, some companies had difficulty recruiting for interviews.

“But now it’s easier, last year more than 1,500 were inserted into the market. The city offers training for interviews and preparation of CVs and provides a room for selection, in case the company needs it”, says Mônica de Menezes, secretary of the Work.