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The leading employer
Marcos Gouvêa de Souza - CEO, GS&MD - Gouvêa de Souza
Last year, according to data from the Ministry of Labor, revealing in firsthand data from the General Employed and
Unemployed People Register (Caged), there were generated 2.5 million formal jobs in the country, 19.8% of them in the
retail segment.
The government remains as the largest formal employer in the country, with around 8.8 million people; followed by retail,
with a little more than 6.9 million. The latter, however, is the fastest-growing one, and shall remain this way in the next years.
Employment in Brazil lives a specially upbeat moment, with historically low unemployment rates, reaching 5.3% in
December and presenting in 2010 an average of 6.7%, below the 8.1% of 2009 and 7.9% of 2008, as a consequence of
the economic growth the country has been experiencing in the last years, in spite of the global crisis.
The expansion of the number of jobs in retail relies on the growth of the segment: 10.9% in 2010, after rising 5.9% in
2009, leveraged by the credit offer rise; by the improving income of population; by the evolution of the job market; and by
the rising consumer confidence. These factors have been making family spending grow, thus speeding up retail sales.
Different from other economic segments, in which growth has been leveraged by more technology, automation,
robotization and other resources, retailers, when expanding, need to hire more people to work in the stores, distribution
centers, financial services and infrastructure, also creating jobs along the distribution chain, as products and services
suppliers also grow in the process.
The expansion of the industry, for example, has been done with less additional jobs created, as processes become
automatized. The same has been happening in the large scale agriculture or in a part of the construction sector, due to
the incorporation of newer and more modern technologies.
The almost 140,000 direct collaborators of Grupo Pão de Açúcar the country’s largest retailer, are almost the double of
all jobs created by the automobile industry. When the government, in the end of 2008, however, was looking for alternatives
to activate the local economy facing the danger of the effects of the global crisis, the first initiative was reducing taxes for
the automobile industry, in a clear sense of lack of sensibility to the segment that is in fact the largest private job creator.
If the Institute for Retail Development (IDV) had not worked hard to show this reality, the tax cuts would not have been
extended to electronics, a category with a much broader appeal. Later, the benefit was offered to building supplies, and
then to furniture.
This lack of sensibility has proved to be chronic, as the government, specially the Ministry of Labor, unaware of the
segment’s reality and of its ability to generate new formal jobs, have been creating rules that, instead of stimulating job
creation, have become an added hurdle for this expansion.
Even with these troubles, the retail segment shall continue to lead the growth of private jobs, only competing head-
to-head with the strong (almost uncontrollable) and undesirable expansion of the government structure. With a crucial
difference: in retail this growth has been occurring directly to improve services and businesses, as companies grow to
reach new markets, consumers and realities.
Some more knowledge of the segment’s environment would certainly help retailers to give a stronger contribution to
the country’s economic expansion. It’s just a matter of greatness. Some common sense and vision.