Brazil’s “unhappiness index” highest in last five years

RIO DE JANEIRO, BRAZIL – Brazilians’ sense of well-being, measured by the “unhappiness index” – sum of inflation and unemployment rates – reached its worst level in 5 years in the first quarter this year.

In the first 3 months of this year, when the country was experiencing the second wave of the novel coronavirus pandemic, the index reached 19.83%, the same level since the third quarter 2016, when Brazil was in recession.

The survey, conducted by economist Daniel Duque, from Ibre/FGV (Brazilian Institute of Economics, of the Getulio Vargas Foundation), also points out that Brazil ranks second worst in unhappiness, behind only Turkey, with 26.28% (the higher, the worse).

GDP (Gross Domestic Product) has grown, but there was considerable job loss in the pandemic that has not yet been recovered, and this is relatively far from happening, Duque says. “Although inflation is still far from double digits, it is also far from the target at the moment.”

There is virtually a consensus among economists that GDP growth of 1.2% in the first quarter was stronger than expected, considering the challenges for the economy to recover amid the spread of the Covid-19 pandemic in Brazil.

Economic growth in the first quarter offset the pandemic losses, returning to the fourth quarter 2019 level, but is still 3.1% below the highest point of economic activity in the country, reached in the first quarter 2014, according to IBGE (Brazilian Institute of Geography and Statistics), and the recovery is not yet perceived by the majority of the population.

The unemployment rate in Brazil reached 14.7% in the first quarter, a record in the IBGE series, begun in 2012. In terms of prices, the pressure of electricity caused inflation to accelerate in May, according to the IPCA (Broad National Consumer Price Index), and the indicator rose 0.83%. In the cumulative 12-month period, the increase reached 8.06% (above the 5.25% cap for this year).

Duque adds that the hike in commodity prices (the basic products on which Brazil depends for its exports) and the lack of exchange rate appreciation have led to a significant increase in food prices.

In addition to Brazil, the unhappiness ranking includes OECD (Organization for Economic Cooperation and Development) member countries. Among the 38 listed, the best positions were held by Japan (2.44%), Switzerland (4.41%), and Slovenia (4.77%).

In measuring the unhappiness index, Brazilians are burdened by both unemployment and inflation indicators. In the case of inflation, Brazil was in 5th place among the worst, behind Argentina, Turkey, Russia and Saudi Arabia.

When observing the unemployment data, the country’s performance is even more worrisome, ranking next to last in the highest unemployment rate, behind only Spain.

Quarterly “unhappiness” index by country, in percentages:

1st TURKEY 26.3
2nd BRAZIL 19.8
3rd SPAIN 16.1
4th COLOMBIA 15.6
5th GREECE 14.1
6th CHILE 13.4
7th ICELAND 11.6
8th ITALY 11.0
9th SWEDEN 10.7
10th CANADA 9.8
11th FINLAND 9.0
12th FRANCE 8.7
13th MEXICO 8.4
14th SLOVAKIA 8.3
15th UNITED STATES 8.1
16th LUXEMBOURG 7.9
17th LITHUANIA 7.7
18th LATVIA 7.6
19th HUNGARY 7.6
20th ESTONIA 7.6
21st PORTUGAL 7.2
22nd AUSTRALIA 7.1
23rd AUSTRIA 7.0
24th NORWAY 6.8
25th DENMARK 6.7
26th NEW ZEALAND 6.2
27th BELGIUM 6.0
28th GERMANY 5.9
29th POLAND 5.8
30th UNITED KINGDOM 5.7
31st IRELAND 5.6
32nd SOUTH KOREA 5.5
33rd CZECH REPUBLIC 5.4
34th THE NETHERLANDS 5.3
35th ISRAEL 5.0
36th SLOVENIA 4.8
37th SWITZERLAND 4.4
38th JAPAN 2.4