Wellton Máximo       Reporter Agência Brasil

Brasília – Brazilian workers celebrated Labor Day (which falls on May Day) against a backdrop of bigger payrolls and lower unemployment, but signs of rising inflation. More money and jobs are certainly good news, although inflation threatens further increases in worker purchasing power.

According to the government statistical bureau (“IBGE”), March unemployment was at a historical low for the month: 6.5%. However, the labor union-linked Department of Socio-Economic Studies (“Dieese”) said March unemployment was 11.2% (even so, the lowest Dieese reading for the month since 2001).

As for payrolls, IBGE says there was a real increase (after discounting inflation) of 6.7%, comparing March 2011 to March 2010. Dieese points out that labor negotiations have gone through a good period, with over 88% of salary disputes in 2010/2011 resulting in real increases for workers, although the vast majority of the real increases were less than 3%.

However, the near future does not look as bright. The Broad Consumer Price Index (“IPCA”), which the government uses as its inflation yardstick, rose 0.79% in March, for a cumulative 12-month increase of 6.3% (the government inflation target for 2011 is 4.5%, plus or minus two percentage points). That 6.3% is uncomfortably near the target ceiling.

José Silvestre, who handles labor union relations at Dieese, says that in spite of the inflation spurt, he does not see a generalized loss of purchasing power for wage earners in 2011. He does admit things are not as positive as in 2010. “There is, it is a fact, rising inflation this year. But the higher costs we see are linked to external factors, such as rising food and fuel prices [international markets control commodity and petroleum prices] rather than domestic demand.”

As for salary negotiations this year, Silvestre says fewer workers will obtain real gains, but many will. “The 2011 scenario is not the same as it was in 2010, but it is still positive. The economy is growing and some labor unions have been able to get real salary increases.”

According to Silvestre, 15% of worker groups (“categorias profissionais”) had real increases of more than 3% above inflation last year, compared to 5% in 2009 and 4% in 2008. “In 2011, it is probable that the percentage will be low again, but some workers will be able to get real increases,” he declared.

Allen Bennett – translator/editor The News in English

Link - Trabalhadores celebram dia com desemprego em baixa e crescimento da massa salarial, mas inflação em alta