BNP Paribas: Brazil: The labor market remains tight.

BNP Paribas: BRAZIL

The unemployment rate in May was 6.4%, unchanged from April and in line with the consensus view. On a seasonally adjusted basis, the unemployment rate rose to 5.9% from a record low 5.8% reached in April. Both the payroll and the labor force expanded in May, by 0.4% m/m s.a. and 0.3% respectively.

The unemployment rate remains near historic lows, indicating a tight labor market. Rapid increases in real wages are symptomatic of this tightness. Real wage growth accelerated to 4.0% y/y in May from 1.9% in April. On a seasonally-adjusted basis, real wages increased 2.2% m/m s.a., the fastest growth since last July. The real wages bill grew 6.6% y/y and 2.6% m/m s.a. in May.

Inflationary pressures stemming from the labor market persist as real wage growth continues to outpace productivity growth.


Latin America

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