Brazil’s unemployment rate to stand at 14.6% in 2021, up from 13.5% in 2020, says CNI

RIO DE JANEIRO, BRAZIL – The proportion of unemployed may reach its highest level in 2021, with an average unemployment rate of 14.6%, projects the National Confederation of Industry (CNI).

In a report released on Monday, March 22nd, the entity considered that, in the basic economic scenario, the recovery of activity will begin in May. The effects of the recovery in the labor market, however, should be delayed and start only in the beginning of the second half of the year.

In this scenario, part of the population that was out of the labor market, either due to discouragement, fear of the pandemic, or for having received some type of government aid, should start looking for work again. “The unemployment rate should grow and register a new record in the second quarter,” said CNI.

Within this arrangement, the number of employed people will be higher at the end of 2021, compared to 2020, the entity assessed. However, with people looking for work again, that is, with the growth of the labor force, the average unemployment rate in 2021 will be 14.6%, higher than the 13.5% observed in the average of 2020, CNI projected.

In the report, the entity highlighted that employment started high at the beginning of the year, according to data from the General Register for Employed and Unemployed (CAGED).

However, the increase in Covid cases and social isolation measures should lead to a drop in economic activity and the interruption of hiring.