Brazil opened 218,902 formal job vacancies in July, according to the Caged (General Registry of Employed and Unemployed), a result below market expectations, around 258 thousand. The number indicates a slowdown in the labor market, but brings an improvement in the quarterly average, which increased from 226 thousand to 240 thousand jobs in the period.
“The July Caged indicated the creation of 219,000 new formal jobs in the job market, slightly below market expectations, at 258,000, and a slowdown in relation to June, which had been 278,000. The number, however, is quite robust, including growth in the pace of hiring in industry and construction, sectors that are more sensitive to monetary tightening, but which continue with a positive outlook due to falling inflation and relief in supply chains,” he highlighted. Rafaela Vitória, chief economist at Inter.
According to her, the service sector had the biggest deceleration after the “strong performance” in the 1st semester, highlighting the record number of formal jobs in the series, at 42.2 million.
“The service sectors had the biggest deceleration, especially after the strong volume in the first half, both in activities related to reopening, such as transport, accommodation and food, as well as administrative”, he said.
In the year to July, almost 1.6 million new formal jobs were created in Brazil, a number that is already close to the 1.8 million formal jobs created in 2021, reaching a record balance of 42.2 million,” he added.
XP economist Rodolfo Margato highlighted the three-month moving average, in addition to highlighting that the balance accumulated in the last 12 months reached 2.550 million (from 2.637 million). According to him, these numbers suggest that formal employment will continue to advance, but at a slower pace.
“There was a net addition of about 1.385 million jobs between January and July 2022, based on seasonally adjusted numbers. We reinforce the view that formal employment will continue on an upward trajectory in the coming months, albeit at an increasingly moderate pace. The balance of formal jobs should total 1.950 million in 2022, according to our projections”, pointed out the economist.
To CNN Brasil Business Fabio Bentes, economist at the National Confederation of Trade in Goods, Consumption and Tourism, highlighted the impact of the service sector on the Caged indicator.
“The locomotive of the economy is turning much faster, but being pulled by services. That’s because service inflation is not as high as media inflation, and that helped the service sector throughout the year,” he declared.
“There is still a remnant of the post-pandemic resumption effect, as the number of consumers is higher than last year. The sector had to recover the pre-pandemic level to actually generate employment more sharply.”
Bentes stressed that consumption is strong, but said that it tends to cool down until the end of the year with a lower average income. There was a 3% drop in real average income, that is, adjusted for inflation, compared to July 2021.
“Essential consumption growing on account of Auxilio Brasil, but consumption of durable goods, which depends on higher income, a high degree of confidence, tends to be harmed. Some external events can soften the loss, like the World Cup, or the arrival of 5G, as a lot of people think about switching their cell phone, but this is an effect from the middle class upwards,” he said.
Finally, the chief economist at Nécton, André Perfeito, said that the creation of formal vacancies in recent months was extremely strong, which justifies a deceleration in the indicator.
“We should probably see an accommodation in the creation of vacancies, after all, it has advanced a lot over the last few months”, he pointed out.
Source: CNN Brasil

I am Sophia william, author of World Stock Market. I have a degree in journalism from the University of Missouri and I have worked as a reporter for several news websites. I have a passion for writing and informing people about the latest news and events happening in the world. I strive to be accurate and unbiased in my reporting, and I hope to provide readers with valuable information that they can use to make informed decisions.