Brazil: Employment rate sees biggest drop since 2001

13 March 2009

Rio de Janeiro, Brazil, 13 March – The employment rate in the Brazilian industrial sector fell by 2.5 percent year on year in January, the biggest drop since 2001, Brazil’s Geographical and Statistics Institute (IBGE) said Thursday in Rio de Janeiro.

In January of this year, the number of employed workers also fell against December 2008, by 1.3 percent, the IBGE said.

The number of employed workers has seen consecutive falls since October 2008, when the Brazilian economy began to feel the effects of the international financial crisis.

Large Brazilian companies, such as aeronautical manufacturer Embraer and mining company Vale, have announced redundancies or enforced vacations for thousands of workers.

Figures from the IBGE also showed a fall in the number of hours paid to workers, which resulted in a 1.2 percent drop in salary costs for companies in January, as compared to December.

On Tuesday the IBGE said that the Brazilian economy had contracted by 3.6 percent in the final quarter of 2008, against the third quarter, in its biggest drop since 1996.

In order to stimulate economic activity, the Brazilian Central Bank Wednesday announced a 1.5 percentage point drop in benchmark interest rates. (macauhub)