64% of All Jobs in Brazil Are in Small Business in the Interior

Craftwork in Brazil Brazil's labor market has shown improved dynamism outside of the country's metropolitan regions in recent years. From the total of 2.2 million formal employer companies, 66.3% are based in municipalities in the interior of the country.

Micro and small businesses headquartered outside of the capitals and large cities answer to 64% of employment positions, i.e., 13.2 million jobs.

The data were culled from the 2008 Directory of labor at Micro and Small Companies, commissioned by the Brazilian Micro and Small Business Support Service Brazilian Micro and Small Business Support Service (Sebrae) from the Inter-Union Department of Statistics and Socio-Economic Studies (Dieese).

The survey contains information on 6,073,056 micro, small, medium, and large-sized formal companies. Out of that total, 2,184,934, or 97.5%, are micro and small businesses. Medium and large companies, in turn, total 56,137, i.e., 2.5% of enterprises.

In regional terms, municipalities in the interior of the Southern Region are the ones that employ the most. Micro and small-sized companies provide 81.3% of total job positions there. The Southeast Region ranks second, with 64.7% of jobs at micro and small businesses located outside the metropolitan regions.

Next comes the Northeast, with 50.4% of jobs in the interior. Then come the North, with 47.8% of people employed far from the capitals, and the Midwest, with 44.9%.

In terms of economic sectors, industry is the leading employer segment. In 2006, the industrial sector answered to 77% of total workers employed in municipalities in the interior. After industry, micro and small trade sector businesses are the second largest employers, accounting for 66% of job positions outside of big cities.

In construction and services-related activities, labor is relatively evenly distributed among capital and interior, with shares of 56% and 55%, respectively. The technical director at Dieese, Clemente Ganz Lúcio, believes that one of the factors that explain the dynamism of the interior's economy is smaller distance between final production and the industrial process, with factories located in privileged regions. Coupled with that, the director also mentions the increase in purchasing power of consumers outside the capitals.

To the manager at the Agribusiness Unit of Sebrae National, Juarez de Paula, the growth of the agricultural sector, driven mostly by rising exports, and the saturation of large cities' markets explain the expansion of new dynamic centers in Brazil.

"We export most of the agricultural products, such as meats, orange, soybean, coffee, sugar and alcohol. This translates into greater productivity and demand for services, especially in the post-production phases. We have concrete examples of active economies in the west of the state of Bahia, in Mato Grosso and Piauí­," he informed.

Sebrae

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