Minimum wage now 75 years old

Brazil's minimum wage is now showing its higher purchasing power since it came into force 75 years ago, in July 8, 1940. It may be deemed crucial to redressing the country's inequality, says political scientist and historian Dulce Pandolfi, also a professor at the Getúlio Vargas Foundation. Ever since January, the minimum wage has stood at R$ 788.00 ($244.10).

“The country made major improvements over the last years. In fact, when we say inequality has been reduced, the main reason behind it is the higher purchasing power of the minimum wage.  Its real value has increased considerably. Of course it's low, but this is the period with its purchasing power at its highest,” she argued.

Data from the Inter-Union Department for Statistics and Economic Studies (Dieese) reveal that approximately 46.7 million Brazilians have the minimum wage—adjusted as it is every year on January 1 according to the nation's economic performance—as their basic income.

The real increase in the minimum wage over the last 11 years is 76.5%, as reported by the Ministry of Labor and Employment. “In spite of the current economic situation, it's good news, and it deserves to be made known on this day,” Minister Manoel Dias said.

History

Pandolfi noted that the minimum wage was born as a social right. On May 1, 1940, then-President Getúlio Vargas established the values that came into effect on July 8 of that year. Later, worker-centered policies started being implemented, which culminated in the Consolidation of Labor Laws, known as CLT, passed in 1943.

At the time, Brazil had 14 different minimum wages—then-capital Rio de Janeiro's being nearly three times as high as the Northeast's. It was only in 1984 that the national minimum wage was created, enshrined in the chapter on social rights of the Federal Constitution of 1988, which stipulates that it should meet all the needs of Brazilian workers and their families. The legislation also brought the country's varying wages into a single, standardized value, and laid down how it should be periodically adjusted to preserve its purchasing power.

According to Dieese, in order for workers to have their housing, education, and health care rights ensured as guaranteed by the Constitution, the current minimum wage should be R$ 3,299.66 ($1,022.14).

Translated by Fabrício Ferreira