Brazil’s labor informality rate falls
The informality rate in the Brazilian labor market reached its lowest level since the quarter ending in July 2020 - in the period from November 2025 to January 2026 - at 37.5 percent of the country’s employed population. This represents 38.5 million workers without formal employment registration.
In the previous moving quarter, the rate stood at 37.8 percent, and in the same quarter of 2024, at 38.4 percent.
The data come from a survey by the Brazilian government’s statistics agency IBGE and were released on Thursday (Mar. 5).
The research coordinator, Adriana Beringuy, said that informality has been declining since 2022, with the pace of the decline accelerating from 2023 onward, and that employment quality is currently the highest since IBGE records began.
The explanation for the decline in this quarter, according to the coordinator, is the reduction in employment without a formal work contract in the private sector, as well as an increase in the registration of self-employed workers in the National Registry of Legal Entities (CNPJ).
According to Beringuy, the most significant contraction occurred among workers without a formal work contract.
The employed population in the Brazilian labor market, currently around 103 million people, remains stable overall. Its informal sector, although also relatively stable, is declining slightly.
In the coordinator’s assessment, this trend will later be reflected in higher worker income.
“This composition has helped maintain worker income at a higher level because, in addition to preserving the gains observed in 2025, it enters 2026 with a structure that supports the stability of labor income, which remained at BRL 3,652,” the coordinator explained.
The average real income from all jobs reached BRL 3,652, the highest in the series, with an increase of 2.8 percent in the quarter from November 2025 to January 2026 and 5.4 percent in the annual comparison, the survey reads.
Survey
IBGE considers it the main survey on the Brazilian workforce, covering 211,000 households across 3,500 municipalities visited each quarter.
About 2,000 field staff work on the research through more than 500 IBGE offices across the country.
Starting on March 17, 2020, due to the COVID-19 pandemic, IBGE adopted telephone-based data collection for the survey. In July 2021, it returned to in-person data collection.
