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Brazil's unemployment rate remains in gentle downtrend [ClearOnMoney]
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Brazil's unemployment rate remains in gentle downtrend

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Commentary

Brazil's unemployment rate remains in gentle downtrend

31 Jan 2013 by Jim Fickett.

The unemployment rate in Brazil normally bottoms each December. Looking at the accompanying graph with this in mind makes it clear that recently unemployment continues its long-term improvement, but by a smaller than usual amount.

The low unemployment rate is, at least in the short run, good news for the household sector. However it is not obvious that it is good news, on any scale, for the Brazilian economy, or even for the household sector in the longer run. The fact that unemployment continues to drop when the economy is stalling is direct evidence in support of the frequent criticism that Brazil's labor market is too inflexible, i.e. it is nearly impossible to fire workers. Sometimes people forget that the economy is, most fundamentally, about people producing useful goods and services for each other. Paying unneeded workers to do nothing buys votes, but does not, in the long run, produce prosperity.

(See the Reference page Brazil unemployment for background, past commentary, and data sources.)