On the other hand, average real wage declined, according to new data from statistics agency IBGE
06/22/2023
The number of companies in the country grew in 2021 driven by firms without employees, as did the number of employed personnel, but the average real wage declined, according to new data from the Brazilian Institute of Geography and Statistics (IBGE).
The number of companies in the country increased by 5.8% in 2021 to 5.75 million, the highest since 2019 (6.1%). Meanwhile, the number of employed salaried workers grew 4.9% to 47.62 million, the strongest pace since 2011 (5.1%). That’s 2.2 million more workers entering the market. The growth was more than enough to recoup the losses of 2020, when there was a 1.8% decline.
Despite the strong expansion, the movement was followed by a 2.6% drop in the real average salary between 2020 and 2021, to R$3,266 from R$3,353, according to the Central Company Register Statistics – 2021 (Cempre 2021) survey. In the same year, 2021, the Brazilian GDP grew by 5%, a pace sufficient to recover from the 3.3% loss seen in 2020.
In the case of companies, expansion in 2021 was driven mainly by businesses without salaried employees, whose growth was 7.7% in 2021, to 3.08 million people. Companies with one or more employees grew at a slower rate of 3.6% to 2.66 million.
Almost two-thirds of the increase in companies (205,400) occurred in the services industry, as research analyst Eliseu Oliveira points out. In this sector, legal activities, architectural and engineering services, advertising, office and administrative support services, information technology services, and services of health professionals other than doctors and dentists stand out.
“These are activities that are characterized by a higher concentration of companies without employees. These activities, which have been growing in recent years, require a specific technical capacity from their employees, but once this capacity is reached, they require low initial investments in physical and financial capital,” he said.
A negative highlight of the research is that the real average salary dropped by 2.6% between 2020 and 2021, to R$3,266, already excluding the effect of inflation. According to Mr. Oliveira, there are two reasons for this drop in real wages: inflation (of 10.16%, according to price index INPC), and workers returning to the market with lower wages.
“With inflation, nominal salaries, which we can understand as the values expressed in the paycheck, were not able to maintain the consumption pattern of households in 2021. Secondly, what can explain the fall in real wages is the existence of workers who lost their jobs in the pandemic and accepted lower wages,” he said.
In the analysis by level of education, the average salary in 2021 was R$2,238 for those who did not have a college education and R$6,613 for those who did. In other words, more educated workers earn almost three times as much as less educated workers.
However, when the value of the salary is considered in terms of its equivalence to the minimum wage, the average real salary in the country increased to 3 minimum wages in 2021 from 2.9 minimum wages in 2020.
With the decrease in the average real salary, despite the increase in the number of employees, the wage bill of formal companies was almost stable in 2021, with a variation of only 0.3%, at R$2 trillion.
The IBGE data also show that of the 2.2 million increase in the number of employees in formal companies in 2021, almost half (48.3%) came from only three activities: commerce, repair of motor vehicles and motorcycles (428,500), transformation industries (386,900) and public administration, defense and social security (260,300). However, the growth was uneven: 14 out of 16 segments increased the number of employed persons.
*Por Lucianne Carneiro — Rio de Janeiro
Source: Valor Internationa