September 22, 20 - 10:31 am - LABS

FGV study points out that pandemic caused an income drop of 20.1% in Brazil

According to a new study released by FGV and first reported by Agência Brasil, the first quarter of the COVID-19 pandemic officially declared on March 11, caused an average loss of 20.1% in the income of Brazilians, from BRL 1,118 to BRL 893 monthly. The study considers formal and informal markets, as well as the share of workers without a job.

During the period, the Gini index, a measure intended to represent the income inequality, increased 2.82%. Both the average fall in income and the Gini index reached a record level when analyzing variations in the historical series, which started in 2012. While the poorest saw income shrink 27.9% – from BRL 199 to BRL 144 -, the impact was 17.5% – from BRL 5,428 to BRL 4,476 -, among the richest 10% in the country.

The researchers associate the drop of more than 25% of income to the reduction of the working day (-14.34% in the national average), and to other factors, such as the decrease in the offer of vacancies. The occupancy rate, that is, the share of the labor force that has a job, also fell by 9.9%.

FGV’s study further concluded that groups most affected were indigenous, illiterate, and young people aged 20 to 24 years. According to the researchers, women saw a sharper impact, with a 20.54% drop in income, against 19.56% of men.