Brazil steps up formal job creation in 2024 despite unexpected December slump

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BRASILIA, Jan 30 (Reuters) - Brazil accelerated formal job creation by 16.5% in 2024 compared with the previous year, labor ministry data showed on Thursday, in a year of robust economic performance tempered by a surprisingly weak end.

The country created a net 1.694 million formal jobs in 2024, the ministry said, up from 1.454 million in 2023, the first year under leftist President Luiz Inacio Lula da Silva.

In December, however, Latin America's largest economy shed a net 535,547 formal jobs, more than the 402,500 forecast in a Reuters poll of economists.

This marked the weakest December performance since the new methodology for the official series was introduced in 2020.

December is traditionally negative for jobs due to layoffs of temporary workers hired to support year-end sales.

Formal jobs refer to positions where workers are officially registered, with rights protected under the country's labor legislation. Brazil's economy has a significant contingent of informal workers, totaling around 40 million. Formal workers totaled 47.2 million in December.

Brazil's labor market has shown strong momentum, which the central bank has flagged as a concern due to inflationary pressures.

On Wednesday, policymakers raised interest rates by 100 basis points to 13.25% and signaled a similar hike at their next meeting in March.