2010 was a good year for salary negotiations

In 2010 there were 71 rounds of contract negotiations involving workers in the steel and auto industries (“metalúrgico”) in Brazil. In 96% of the bargaining, workers got a real salary increase, the best result in a decade, says the union-linked Department of Socio-Economic Studies and Statistics (“Dieese”). Furthermore, in 100% of the negotiations, workers were ensured at least increases that guaranteed them adjustments to cover losses due to inflation.

In the state of São Paulo, over 90 % of all salary negotiations, in all economic segments (industry, commerce and services) resulted in salary raises that compensated workers for inflation.

Rafael Serrao, an official at Dieese, says unions did a good job in a favorable economic environment. “The economy started growing again after the crisis and the jobs opened up. The “metalúrgico” unions took advantage of the situation and negotiated favorable contracts,” he stated.

Serrao said unions expected 2011 to be a good year as well, although the economic situation (“conjuntura”) has changed. He said the most important new factor was the government fiscal adjustment (a budget cut of R$50 billion). “However, there is room for further salary increases above inflation,” he declared, pointing out that with domestic market demand heated up, production and revenue are expanding as well.

The president of another union, the FEM/CUT-SP, Valmir Marques da Silva, explained that the goal in 2011 was to stabilize the labor market, reducing job turnover, by elevating entrance salaries. “Turnover (“rotatividade”) is a problem, especially in the electrical-electronic and auto parts sectors,” he declared. Silva admitted that 2011 will be a challenge with economic expansion slower than in 2010.