Brazil's unemployment rate dipped in October on a shrinking number of jobseekers, as analysts said flat wages signalled an impending slowdown in the labour market in Latin America's biggest economy. Brazil's jobless rate dipped to 5.8 percent in October from a previously-reported 6.0 percent in September, the government's statistics agency IBGE said on Thursday.
The figure, below the 5.9 percent expected in a Reuters poll, was the lowest October rate since the IBGE started collecting data in the current format in 2002 and the lowest overall since December's 5.3 percent. Real wages, or salaries discounted for inflation, were flat month-on-month at 1,612.70 reais ($869.71) and dipped 0.3 percent from the year-earlier month - a potential relief for policy-makers, who have fretted over fatter paychecks as inflation has sped in recent months. "The unemployment rate recently stabilised close to record lows, while wages have lost steam lately," wrote BNP analysts in a note to clients. "Looking ahead, a slowdown in the economy should weigh on employment and wage trends."
Last year Brazil's unemployment rate notched a series of record lows. The tight market helped boost salaries, especially as employers sought workers with higher levels of education and technical skills. The higher wages, in turn, have pressured prices, with the annual inflation rate above a 6.5 percent government target ceiling since April. But a eurozone sovereign debt crisis and fragile US recovery have pressured the global economy recently, with formal job creation in Brazil braking sharply in October from September. The labour ministry blamed the slowdown on the outlook abroad, saying job creation would keep decelerating through year-end.
The central bank has also noted the global growth fears, chopping a full percentage point off its benchmark interest rate since August. Last month, the number of Brazilians with jobs in the six major metropolitan areas surveyed edged up 0.14 percent to 22.682 million people and rose 1.5 percent from the year-ago period, the IBGE said.