Brazil to boost aid for informal workers, formal jobless insurance claims surge 76.2%

Reuters

Published May 21, 2020 05:39PM ET

Updated May 21, 2020 06:20PM ET

By Jamie McGeever and Marcela Ayres

BRASILIA (Reuters) - The mounting pressure on Brazil's workforce from the unfolding economic crisis during the new coronavirus outbreak was highlighted on Thursday as figures showed a 76% surge in formal unemployment insurance claims, and the Economy Ministry said it will increase emergency aid for informal workers.

Latin America's largest economy is expected to shrink more than 5% this year, its steepest economic downturn since records began in 1900, and central bank president Roberto Campos Neto said this week that the unemployment rate will likely exceed 15%.

Economy Ministry figures showed that formal unemployment insurance claims in the first two weeks of May totaled 504,313, a rise of 76.2% from the same period a year earlier.

Some 77.5% of these claims were made online, the ministry said, compared with 1.7% a year ago, because of social isolation and quarantine measures in place across Brazil.

The year-to-date total to mid-May was also up from a year ago, by 9.6% to 2.84 million claims, the figures showed.

The figures were released shortly after the Economy Ministry said that total emergency measures taken so far amount to 344.6 billion reais ($62 billion), which will have an impact on this year's primary budget worth 4.7% of gross domestic product.

Officials told reporters in Brasilia the emergency payments for low-paid, informal workers scheduled to be rolled out over three months will now total 151.5 billion reais.

That is up from 98.2 billion reais originally, then a revised 123.9 billion reais, due to more claims than forecast.