1. Home
  2. / Economy
  3. / Minimum wage increase? The government is putting a damper on Brazilians' beer and the minimum wage adjustment will be lower than expected
reading time 4 min read Comments 68 comments

Minimum wage increase? The government is putting a damper on Brazilians' beer and the minimum wage adjustment will be lower than expected

Written by Alisson Ficher
Published 14/12/2024 às 23:06
Government limits minimum wage adjustment in 2025 to save R$70 billion, but faces resistance in Congress and among allies.
Government limits minimum wage adjustment in 2025 to save R$70 billion, but faces resistance in Congress and among allies.

The minimum wage for 2025 will have the smallest increase expected, with the adjustment limited to 2,5% by the government. The measure aims to save R$70 billion, but faces strong resistance in Congress and among allies. With purchasing power under threat, millions of Brazilians question the impact of the decision. Check out the details and join the debate!

If you thought that increasing the minimum wage would be enough to alleviate the burden of inflation on Brazilians' pockets in 2025, you'd better review your expectations.

The federal government decided to tighten its belt even further and adopt a smaller adjustment than the current rule provided for, even in the face of a delicate economic scenario.

The decision, which promises to be controversial, is part of a package of austerity measures that is already facing resistance both in Congress and in public opinion.

Adjustment below expectations

According to current legislation, the minimum wage must be adjusted for accumulated inflation, plus the growth of the Gross Domestic Product (GDP) over the previous two years.

This calculation would increase the current value from R$1.412 to R$1.528. However, the government has set a ceiling for the increase above inflation, limiting it to 2,5%.

With this restriction, the new minimum wage in 2025 will be R$1.517, a difference of R$11 in relation to the initial projection.

According to the government, the measure aims to save resources and balance public accounts, especially given the need for approval of a spending cut package in Congress.

If the 2,5% ceiling were not adopted, the financial impacts would be greater, compromising fiscal planning for the coming years.

Billion-dollar economy and release of amendments

According to estimates, the adjustment measures, including the limit on the increase in the minimum wage, could generate savings of R$70 billion in two years.

To ensure support for the measures in Congress, the government has stepped up the release of parliamentary amendments.

According to recent information, around R$2 billion has already been allocated to deputies and senators since the minister of the Federal Supreme Court (STF), Flávio Dino, unblocked the resources previously frozen due to lack of transparency.

Despite this effort, the government's strategy faces significant challenges.

Establishing a ceiling for the minimum wage and tightening the rules for the Continuous Benefit Payment (BPC) are actions considered unpopular, even among parliamentarians from the allied base.

The rapporteur for the matter, deputy Isnaldo Bulhões (MDB) acknowledged that the deadline is short and that the approval of the measures is uncertain.

Alternative plans and resistance in Congress

To get around any obstacles, the government already has a plan B prepared: the publication of a provisional measure if the bills do not advance within the established deadline.

Among the proposals included in the package of cuts is the PEC that limits so-called super-salaries in public service and the project that restricts parliamentary amendments directed at electoral bases. Both measures face strong resistance in Congress, increasing pressure on the Executive.

Impacts on the daily lives of Brazilians

The controversy surrounding the readjustment of the minimum wage directly affects the lives of millions of Brazilians, especially those who depend exclusively on this amount to survive.

With the limited increase, purchasing power remains compressed, making access to essential goods and services even more difficult.

On the other hand, the government argues that containment measures are crucial to avoid fiscal imbalances that could harm the economy in the long term.

Next Steps

With the deadline tight and resistance growing, the coming weeks will be decisive for the future of the proposed measures.

Congress needs to deliberate on the package before the parliamentary recess, but the division of opinions within the government's own base could delay the process.

If the measures are not approved, the fiscal impact could be even greater, compromising the objectives set by the Executive.

And you, do you think that limiting the readjustment of the minimum wage is a viable solution or just another burden on the population's shoulders? Leave your opinion in the comments!

  • Reaction
  • Reaction
  • Reaction
  • Reaction
  • Reaction
81 people reacted to this.
React to article
Register
Notify
guest
68 Comments
Older
Last Most voted
Feedbacks
View all comments
Christian
Christian
15/12/2024 07:37

For those who think that the government **** understands economics, here's a tip: hire Paulo Guedes, because Haddad is a street vendor!!

Wagner
Wagner
15/12/2024 08:24

Due to the lack of character of the rulers, they always penalize taxpayers when they should effectively substantially reduce spending on absurd expenses, jobs with indications from political godfathers and companions, salaries and privileges in all powers and spheres of government.

Hugo
Hugo
15/12/2024 09:50

Inflationary pressure comes from the weight of the tax burden, which takes away people's purchasing power, removes the national market from international and national competitiveness, reduces job creation and increases the need to increase the minimum wage. In Brazil, seeing an increase in the minimum wage is the same as seeing **** running after his own ****; it gets you nowhere.

Josiah Rincon
Josiah Rincon
15/12/2024 12:25

So, the minimum wage of 1.517,00 will cost approximately R$2.500,00

Maura Alves
Maura Alves
15/12/2024 16:12

It's a shame to raise the minimum wage and talk about the inflammation that is hidden, because the prices of things are absurdly expensive. And they say that there is no inflammation all year round talking about raising the minimum wage while their salaries are resolved overnight. It's shameful.

Isaiah Costa Barbosa
Isaiah Costa Barbosa
In reply to  Christian
15/12/2024 16:46

Paulo Guedes would do better, he would leave the minimum at 200 reais to please the market and he would legalize slavery.

Alisson Ficher

Journalist graduated in 2017 and working in the field since 2015, with six years of experience in print magazines and over 12 thousand online publications. Specialist in politics, jobs, economics, courses, among other topics. If you have any questions, want to report an error or suggest a topic on the topics covered on the site, please contact us by email: alisson.hficher@outlook.com. We do not accept resumes!

Share across apps
2
0
We would love your opinion on this subject, comment!x