Half of Brazilians Live on R$413 per Month

RIO DE JANEIRO, BRAZIL – The poorest half of the population, nearly 104 million Brazilians, lived on only R$413 (US$103,25) per month, considering all sources of income.

At the other end, the wealthiest one percent – only 2.1 million people – had an average monthly income of R$ 16,297 per person. In other words, this small, wealthier portion of the population earned almost 40 times more than half the base of the population pyramid.

Throughout Brazil, 10.4 million people (five percent of the population) survive on an average of R$51 per month. If we consider the poorest 30 percent, the equivalent of 60.4 million people, the average per capita income rose to only R$269.

Even after the economic crisis had passed, inequality worsened. The per capita household income of the poorest five percent fell by 3.8 percent between 2017 and 2018. Concurrently, the income of the wealthiest share (one percent of the population) increased by 8.2 percent.

The Gini Index of per capita household income – a measure of income inequality on a scale of 0 to 1, in which the closer to 1, the greater the inequality – climbed from 0.538 in 2017 to 0.545 in 2018, a peak in the survey.

The poorest became poorer, the richest became richer, confirmed Maria Lucia Vieira, manager of PNAD. According to the researcher, the phenomenon is related to the crisis in the labor market, which affected in particular workers with lower qualifications and lower pay.

“Those who earn the most remain in the labor market,” said Maria Lucia Vieira.

When job creation began to improve, the unemployed who succeeded in returning to the job market began to earn less in similar jobs or to work in informal jobs, which also pay less.

“When people lose their jobs, they will find other jobs where they can earn some pay. If the demand for work is greater than supply, people eventually accept jobs with lower salaries,” explained the manager of PNAD.

With more people working, the income from all sources rose from R$264.9 billion in 2017 to R$277.7 billion in 2018. As income concentration increased, the poorest ten percent held only 0.8 percent of the income mass, while the richest ten percent accounted for 43.1 percent of the cake.

If only workers with income from employment are considered, the best paid one percent earned R$27,744 monthly, corresponding to 33.8 times the income of the 50 percent of workers with the lowest incomes, who earned R$820 on average, less than the minimum wage in force that year. The gap was the largest in the survey’s historical series.

The Gini index of labor income also worsened in the transition from 2017 to 2018, rising from 0.501 to 0.509 in the period, the highest level in the series.

Source: Estadão