The Dynamics of Labour Informality in Brazil, 2003-2019

Abstract

This article examines the evolution of labour informality in Brazil between 2003 and 2019, a period marked by strong political, economic and social inflections. In the first section, we offer a brief reflection on the terms of the historical debate on informality and its relation to the transformations of the Brazilian economy. In section two we describe the remarkable process of labour formalisation that took place in the country between 2003 and 2014, pointing out its exceptionality and principal determinants. In section three, we note the reversal of this formalisation trend. With the recession of 2015–2016, informal and precarious work increased sharply, exacerbated by newly flexible labour laws and the emergence of new precarious labour relations. We conclude that the Brazilian experience in this new century shows that the formalisation of labour relations is strongly related to more general conditions of economic development and the solidity of public institutions. Furthermore, and in contrast to the views held in mainstream economics, initiatives to simplify and ease the regulatory framework appear to coexist with increasing levels of precariousness and informal work. KEYWORDS: labour informality; Brazilian labour market; public policy; labour regulation; gig economy