Sustaining Employment and Wage Gains in Brazil

Abstract

In the past 15 years, employment, labor market participation, and wages have grown significantly in Brazil. Improved labor market outcomes have been the main drivers of reductions in poverty and inequality. But job creation is already slowing. Continued progress in employment and labor earnings will depend on the country’s ability to achieve a first critical goal: raising labor productivity. Continued improvements in the livelihoods of the poor will depend on the country’s ability to achieve a second critical goal: connecting the poor to better, more productive jobs.

Sustaining Employment and Wage Gains in Brazil: A Skills and Jobs Agenda analyzes Brazil’s labor markets and identifies the key challenges involved in sustaining job creation, wage growth, and poverty reduction. The book discusses reforms of program design and implementation in the policy areas of skills development, unemployment insurance and other labor market regulations, active labor market programs, and productive inclusion programs. The report reviews existing interventions in these four policy areas and proposes an agenda of incremental policy changes that could more effectively support the two critical goals. It also describes specific opportunities in each policy area to better coordinate programs with private sector demands and across policies, while also adapting them to improve the results for the urban and rural poor. An essential first step will be to strengthen monitoring and evaluation systems to measure results by tracking the effects of programs on labor market outcomes and using that information to inform program expansion.