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Brazil Boosts Minimum Wage To $245 In 2025
(MENAFN- The Rio Times) President Luiz Inácio Lula da Silva of Brazil signed a decree raising the minimum wage by 7.5%. The new wage will reach 1,518 reais ($245.49) starting January 1, 2025. This increase surpasses the accumulated inflation for the period.
The wage hike adds 106 reais ($17.15) to the previous amount. Lula had earlier approved a law limiting minimum wage adjustments to 2.5% above inflation from 2025 to 2030. The government calculated the new wage using the National Consumer Price Index of 4.84% for the past 12 months.
They added 2.5% of the Gross Domestic Product to this figure. This method ensures a real increase above inflation. Labor Minister Luiz Marinho emphasized the importance of this policy for income distribution. He called it a commitment to raising the minimum wage above inflation every year.
Marinho warned that without this policy, approved in 2023, the country would face a "tragedy". He expects Brazil to continue its growth cycle in 2025. The wage increase will impact about 59 million Brazilians, according to the Inter-Union Department of Statistics and Socioeconomic Studies.
Brazil Boosts Minimum Wage to $245 in 2025
This group includes approximately 19 million retirees and pensioners who receive the minimum wage. The government's decision aims to boost purchasing power and stimulate economic growth. However, some economists worry about potential inflationary pressures from the wage increase.
Critics argue that raising the minimum wage might lead to job losses in small businesses. Supporters counter that it will increase consumer spending and reduce income inequality. The debate continues as Brazil navigates its economic recovery amid global uncertainties.
The wage hike adds 106 reais ($17.15) to the previous amount. Lula had earlier approved a law limiting minimum wage adjustments to 2.5% above inflation from 2025 to 2030. The government calculated the new wage using the National Consumer Price Index of 4.84% for the past 12 months.
They added 2.5% of the Gross Domestic Product to this figure. This method ensures a real increase above inflation. Labor Minister Luiz Marinho emphasized the importance of this policy for income distribution. He called it a commitment to raising the minimum wage above inflation every year.
Marinho warned that without this policy, approved in 2023, the country would face a "tragedy". He expects Brazil to continue its growth cycle in 2025. The wage increase will impact about 59 million Brazilians, according to the Inter-Union Department of Statistics and Socioeconomic Studies.
Brazil Boosts Minimum Wage to $245 in 2025
This group includes approximately 19 million retirees and pensioners who receive the minimum wage. The government's decision aims to boost purchasing power and stimulate economic growth. However, some economists worry about potential inflationary pressures from the wage increase.
Critics argue that raising the minimum wage might lead to job losses in small businesses. Supporters counter that it will increase consumer spending and reduce income inequality. The debate continues as Brazil navigates its economic recovery amid global uncertainties.
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