Brazil’s labor market deterioration likely continued in September, jobless rate to have reached 12 pct

The Brazilian labor market deterioration is expected to have continued. In the past year, the jobless rate has increased by three percentage points and has increased by 5.5 percentage points since 2014 when the deep recession began adversely impacting Brazil’s labor market. Joblessness has surprisingly increased during this period due to an increase in labor force growth and the loss of employment opportunity.

But, recent figures indicate that labor force growth has come back to its average in 2012-2014, whereas the pace of job losses has quickened. With the persistent weakness in growth in the third quarter, the recent pace of labor force and employment is expected to continue through 2016, according to Societe Generale. Brazil’s jobless rate is likely to have reached 12 percent in September. Growing unemployment is bound to maintain the prospect of a consumption-led growth rebound at bay, added Societe Generale.