Enhancing Coverage and Cost-effectiveness of Brazil’s Unemployment Protection System: Insights from International Experience published by World Bank (2020).
“The economic crisis induced by the COVID-19 pandemic underscored the importance of renewing social protection instruments to protect incomes from the shocks that are channeled through the labor market, in Brazil and around the world. The objective of this policy note is to inform the reform of Brazil’s unemployment protection programs, through a comparison of its salient features with international benchmarks, and by taking stock of the ongoing relevance of these instruments in Brazil’s changing labor market. The note builds on the Brazil Expenditure Review (World Bank 2018), and is informed by the World Bank’s recent white paper on adapting social protection instrument to a changing labor market (Packard et al. 2020).
Brazil’s unemployment insurance, Seguro Desemprego (SD), is available to formal dependent workers1 conditional on complying with the required work history and being dismissed “without just cause”. These beneficiaries received on average a benefit of BRL 1,279 (US$243), 85 percent of the median wage of formal employees, for a mean length of 4.3 months. 2 Dismissed workers also receive a cash benefit from the employer-financed individual savings account (Fundo de Garantia do Tempo e Serviço (FGTS)), and severance pay (Multas)…”
