Formal job creation dropped by half in August

The generation of formal jobs, that is, on-the-books, was down almost 50% in August, compared to August 2011. It was also at the lowest level since 2003. The numbers are from the Ministry of Labor’s General Employment Register (“Cadastro Geral de Emprego e Desemprego – Caged”). In August, 100,900 jobs were created, compared to 190,400 in August 2011.

According to Rodolfo Torelly, head of Public Policy at the Ministry of Labor, the result was a surprise, but not reason for concern, in light of the world economic crisis.

Overall, the job market in August created 1.8 million jobs and lost 1.7 million.  The farm sector had the worst performance, with a loss of 16,600 jobs due to lower employment on coffee plantations in Minas Gerais and Espirito Santo. On the other hand, the services sector added 54,300 jobs, while the commerce sector added 31,300 and manufacturing 16,400.

Torelly expressed dismay at the high rate of turnover on the Brazilian job market that the Caged survey confirmed and said the ministry was working on ways to reduce the phenomenon. “How is it possible that you have to hire 1.8 million people and fire 1.7 million in order to create 100,000 jobs?” he asked.