Productivity and labor market in the services sector in Brazil: advances and persistence of inequalities in the 2004-2015 period

Abstract

Service sector has become the main segment of the world economy in terms of GDP share and job creation. Brazil is no exception, and services have grown their importance in the economy. The main objective of this paper is to analyze the evolution of productivity and the labor market of the service sector in the Brazilian economy from 2004 to 2015, a period during which the country went through a period of economic growth, followed by deceleration and crisis. The results obtained show great heterogeneity among service segments. The use of classic typologies of the sector and its comparison with the multivariate analysis of clusters and principal components highlight an existing duality. One group of segments shows higher productivity, better wages and a more favorable insertion of workers in the labor market, while the other presents much less favorable results. This duality persisted throughout the 2004-2015 period. While productivity remained relatively stagnant, some favorable results deserve mention, such as the reduction of intersectoral heterogeneity and the higher employment growth in the more developed services.