Generation of jobs with a formal contract is slowing down; understand

In August, Brazil generated 147,358 job openings with a formal contract, resulting from 2.24 million hires against 2.09 million layoffs, according to data released by the Ministry of Labor and Employment (MTE) on Monday (29). The balance rose from 134,251 posts registered in July, but the result is the lowest for the month since 2020.

Last month job creation represents a 38.3% drop compared to August last year, when 239,000 formal jobs were created. The deceleration was more intense than the median foreseen by the market (184 thousand, according to the date).

Impact of tariff and interest

Labor and Employment Minister Luiz Marinho said the result shows that the formal labor market “grows less, but continues to grow.” In Marinho’s assessment, it is possible that the tariffs imposed by the US government on Brazil had “a small impacted” in the generation of employment in the south of the country. But for the minister, “the greatest impact is interest.”

The figures released yesterday are part of the new general registration of employees and unemployed (CAGED), a government system that accompanies the admissions and layoffs of workers with a formal contract, one of the main thermometers of employment in Brazil.

Comparing numbers with years prior to 2020, according to analysts, is not adequate because the research methodology has changed.

Why is the job in the job changing?

According to analysis of the genius investments, the result “corroborates the perspective that the labor market will continue resilient over the coming months, even in the face of a more adverse macroeconomic scenario (…), suggesting that the process of slowdown in the Brazilian economy should occur quite gradually.”

For Rodolfo Margato, economist at XP, the poll of O Caged “corroborates the tight labor market scenario”:

– In our view, the unemployment rate will remain below its neutral level, which we estimate between 7% and 7.5% for a very prolonged period.

The service sector was the largest generator of jobs with a portfolio signed in August, with a balance of 81,002 new vacancies. Trade generated 32,612 formal vacancies, the industry had a positive balance of 32,612, and the construction created 17,328 formal posts.

Agro in the opposite

On the other hand, the agriculture recorded negative balance, with 2,665 layoffs. Investsmart Macroeconomics Analyst, Sara Paixão, comments on Agro’s negative result:

– The impact on agriculture jobs may be related to the end of the supersafra, which occurred earlier this year. Another factor that tends to impact employment on agriculture is the tariffs imposed by the United States on products imported from Brazil.

Sara estimates that an accommodation of the labor market is natural in the second semester, given the basic interest rate maintained at 15% per year by the Central Bank Monetary Policy Committee (COPOM).

– Caged already has the second consecutive month of negative surprise, which reinforces the expectations that the BC should start cutting interest during the first trimester of 2026 – he said.

Balance in the year decreases

According to the Caged total data, from January to August the balance is created by 1,501,903 jobs with a portfolio, 13.8% lower compared to the same period of 2024, when 1.74 million formal vacancies were opened.

Despite its slowdown, Brazil had 48.68 million employees with a portfolio signed in late August, an increase in comparison with July this year (48.55 million) and compared to August 2024 (47.35 million).

Regarding the average admission salary, there was a 0.56% increase compared to July and an annual real variation of 0.86%, from R $ 2,275.42 in August 2024 to R $ 2,295 this year.