The unemployment rate in Brazil for the quarter March - May 2025 was 6.2%, a drop of 0.6 p.p. against the quarter December 2024 - February 2025 (6.8%) and of 1.0 percentage points (p.p.) against the same quarter in the previous year (7.1%). The number of workers with a formal employment contract in the private sector reached a record level (39.8 million), remaining stable (0.5%) from the previous quarter and increasing 3.7% from the same quarter last year. Another highlight was the number of discouraged workers, with sharp drops of 10.6% from the quarter ended April, and of 13.1% against the same period in 2024. The data are from Monthly Continuous PNAD, released today (27) by IBGE.

The composite labor force underutilization rate (percentage of unemployed persons, underemployed due to insufficient hours worked and in the potential workforce in relation to the expanded workforce) was 14.9%, having dropped 0.8 p.p. from the previous quarter (15.7%). Against the same quarter in 2024, there was also a drop of 1.9 p.p.

From March to May 2025, approximately 6.8 million persons were unemployed in the country. Against the previous three-month period (December 2024 to February 2025), in which 7.5 million persons were unemployed, this indicator fell by 8.6%, equivalent to a drop of 644 thousand persons. On the other hand, against the same quarter in the previous year, when there were 7.8 million unemployed persons, there was a decline of 12.3%, a reduction of 955 thousand unemployed persons in the workforce.

 “The main factors accounting for the significant drop in the unemployment rate were the increase in the number of employed persons, which grew by 1.2 million people, naturally reducing unemployment, in addition to lower underemployment rates. Thus, similar to previous reports, the labor market is buoyant, leading to a reduction in the number of more qualified workers available and an increase in formal positions,” explains William Kratochwill, survey analyst.

The number of employed persons in the quarter ended May this year was approximately 103.9 million, an increase of 1.2% compared to the previous quarter. In the annual comparison, when there were 101.3 million employed persons in Brazil, there was an increase of 2.5% (2.5 million). The employment -occupation ratio (percentage of employed people in the working-age population), in turn, reached 58.5%, an increase of 0.6 p.p. compared to the quarter December 2024 -February 2025 (58.0%). From to the same quarter in the previous year (57.6%), this indicator had a positive change of 1.0 p.p.  

Informality rate drops to 37.8%, formal employment in the private sector hits record figure and number of discouraged workers is the lowest since 2016   

Informality rate (proportion of informal workers in the employed population) was 37.8%, which corresponds to 39.3 million informal workers. This rate was lower than that in both the previous moving quarter (38.1%) and the same quarter in 2024 (38.6%). The drop in informality is a consequence of the stable number of workers without a formal employment contract (13.7 million), accompanied by a 3.7% increase in the number of self-employed workers with a CNPJ (249 thousand more) in the quarterly comparison and an 8.4% increase in the annual comparison. It is worth mentioning that the number of employed persons with a formal employment contract in the private sector hit a record: 39.8 million, a stable result compared to the previous moving quarter and a 3.7% increase compared to the same quarter last year.

The number of discouraged workers in the quarter ended May is also noteworthy, 2.89 million, the lowest since 2016. “This drop can be explained by the consistent improvement in labor market conditions. The increase in employment generates more opportunities, which are perceived by people who were not motivated,” notes William.   

Public administration, defense, social security, education, human health and social services was the only group where employment increased

Of the ten activity groups investigated by the Continuous PNAD, only Public administration, defense, social security, education, human health and social services recorded growth in employment compared to the previous moving quarter (December 2024 to February 2025). The others did not show significant changes.

The research analyst points out that “this group has a peculiar characteristic in this quarter, as it is when the school year begins. Consequently, a support structure is needed, with the hiring of teachers, assistants, caregivers, cooks and receptionists”.

Against the quarter March - May 2024, five groups increased their workforce: General Industry (3.9%, or 501 thousand persons), Trade, repair of motor vehicles and motorcycles (3.4%, or 655 thousand persons), Transportation, storage and mailing (7.0%, or 395 thousand persons), Information, Communication and Financial, Real Estate, Professional and Administrative Activities (3.7%, or 475 thousand persons) and Public administration, defense, social security, education, human health and social services (3.4%, or 625 thousand persons). On the contrary, there was a drop in Agriculture, livestock, forestry production, fishing and aquaculture (3.9%, or 307 thousand persons).   

Workers' wage bill also hit a record

The average real monthly income from all jobs reached R$3,457 in the quarter from March to May 2025, a stable result, and registered growth of 3.1% against the same quarter in the previous year. Real wage bill (the sum of the compensation of all workers) reached R$354.6 billion, a new record, rising 1.8% in the quarter, an increase of R$6.2 billion, and increasing 5.8% (more R$19.4 billion) in the year. 

According to William, the greater number of employed persons expands the earnings base: “As the average real income remained stable, consequently there was an increase in the mass of income, that is, the greater mass of income resulted almost exclusively from the expansion of the volume of employed persons, and not from an increase in the average earnings”.

More about the survey

The Continuous PNAD is the major survey on workforce in Brazil. Its sample includes 211 thousand households, spread along 3.500 municipalities, which are visited every quarter. Nearly two thousand interviewers work in the survey, integrated with more than 500 IBGE branches in the entire country. 

Due to the Covid-19 pandemic, the IBGE implemented data collection by telephone on March 17, 2020. In July 2021, the data collection became face-to-face once again. The identity of the interviewers can be confirmed at the Answering the IBGE website or through the Call Center (0800 7218181), and their ID numbers can be requested by the informants. 

See PNAD data on Sidra. The next release of the Monthly Continuous PNAD, related to the quarter ended June, will be on July 31.