Brazil Unemployment Rate Falls to Record Low in 2025 | IBGE Data

Brazil’s unemployment rate continued its downward trajectory in 2025, reaching a historic low of 5.1% in December, according to data released by the Brazilian Institute of Geography and Statistics (IBGE). This marks the lowest rate since the current comparable series began in 2012, signaling a strengthening labor market and broader economic recovery.

The December figure represents a decrease from 5.2% in November and underscores a consistent decline throughout the year. The annual unemployment rate for 2025 fell to 5.6%, also the lowest level since 2012, down from 6.6% in 2024. Approximately 5.5 million Brazilians were unemployed in the final quarter of the year, a significant reduction from previous periods.

The positive trend is reflected in the employed population, which reached a record high of 103 million people in 2025, compared to 101.3 million in 2024. This represents a substantial increase from the 89.3 million employed individuals recorded in 2012. The employment rate among the working-age population also hit a record of 59.1% in 2025, up from 58.6% in 2024 and 58.1% in 2012.

The data indicates that the decrease in unemployment wasn’t driven by an increase in workforce underutilization or discouragement – meaning people giving up on finding work. Instead, the decline was supported by genuine expansion in employment, particularly within the service sector. Adriana Beringuy, coordinator of Household Sample Surveys at the IBGE, highlighted this point, noting the expansion of employment as a key factor.

A particularly encouraging sign is the growth in formal private sector employment, which reached a record 38.9 million in 2025. Formal jobs with contracts, excluding domestic workers, also hit a record high of 39.1 million. This suggests a shift towards more stable and secure employment arrangements, offering greater benefits and protections for workers.

Average monthly earnings also saw an increase, reaching a record R$3,484, a 1.3% rise from the previous quarter and a 3.8% increase year-on-year. The real wage bill – the total income earned by workers – also reached a historic high of R$352.3 billion, up 2.5% from the prior quarter and 6.4% from a year earlier. These figures indicate not only more people are employed, but they are also earning more.

The regional data reveals varying levels of improvement. While the national unemployment rate declined, some regions experienced more significant drops than others. Specifically, unemployment fell in six Brazilian states during the fourth quarter of 2025. The data also showed that women in the Northeast and young people in the Southeast regions continued to experience higher rates of unemployment.

The positive labor market data comes as a welcome sign for President Luiz Inácio Lula da Silva, who described the figures as a “record in the historical series” and a reason for optimism heading into 2026. The data is likely to bolster confidence in the government’s economic policies and provide a positive narrative for the country’s economic outlook.

However, despite the overall positive trend, challenges remain. The data indicates that while unemployment has fallen, pockets of vulnerability persist, particularly among specific demographic groups and in certain regions. Continued efforts will be needed to ensure that the benefits of the economic recovery are shared broadly and that all segments of the population have access to quality employment opportunities.

The IBGE data provides a comprehensive snapshot of the Brazilian labor market, offering valuable insights into the country’s economic performance. The sustained decline in unemployment, coupled with rising employment and wages, suggests a strengthening economy and improving living standards for many Brazilians. The record levels of employment and formal sector jobs are particularly noteworthy, indicating a positive shift towards a more stable and inclusive labor market.

Looking ahead, the sustainability of this positive trend will depend on a number of factors, including continued economic growth, stable macroeconomic conditions, and effective government policies aimed at promoting job creation and skills development. The latest data provides a solid foundation for optimism, but ongoing monitoring and proactive measures will be essential to ensure that Brazil’s labor market continues to thrive.