The Brazilian government has announced that the minimum wage will increase from R$1,320 ($272.16) to R$1,412 ($291.13) in 2024.
This adjustment reflects a 6.97% rise, amounting to an additional R$92 ($18.97).
President Luiz Inácio Lula da Silva has signed a decree to formalize this increase, which is expected to be published in the Official Gazette by December 31st.
December 12th reports suggested the new wage would hit R$1,412 ($291.13) after a 3.85% rise in the Consumer Price Index INPC over 12 months.
Earlier projections from the economic team suggested a minimum wage of R$1,421 ($292.99) as outlined in the 2024 Annual Budget Law Project (PLOA).
However, the actual increase will be R$9 ($1.86) less than anticipated, attributed to a more modest trajectory of the INPC.
The Government Leader in the Chamber of Deputies, José Guimarães of the PT-CE, commented on the adjustment, providing insights on the decision.
Background
Compared to other regional countries, Brazil’s minimum wage remains surprisingly low.
Brazil’s minimum wage hike mirrors broader Latin American trends, with Argentina and Chile raising theirs to $429 and $615 due to inflation and demand.
Ecuador is set to increase its minimum wage from $450 to $460, starting January 1, 2024.
In Mexico, President Andrés Manuel López Obrador has announced a 20% hike in the minimum wage for 2024.
A study by the cashback platform Picodi reveals that Uruguay’s minimum wage in Latin America stands at $424.
On the other hand, Paraguay will establish its new minimum wage at 2,680,373 Paraguayan guaraníes, roughly $383.
These wage adjustments are designed to safeguard the purchasing power of low-income earners and boost economic activity.