Brazil’s job market finally shows signs of cooling

For months, Brazil’s labor market had seemed immune to tighter credit and slowing growth. That resilience may now be waning.

Data published today indicate that, while unemployment remains at a record low, job creation has slowed significantly. Treasury Secretary Rogério Ceron said the numbers are a first sign that the labor market is beginning to reflect the broader economic cooldown that the Central Bank has sought to engineer with high interest rates (now at 15%).

The government reported 147,300 new formal jobs in August, which was short of market expectations and significantly below the 239,000 created a year earlier. It was the weakest performance for the month since 2020, when the Labor Ministry changed its data system to the current format.