Economy is not evolving to increase formal market, says expert

Activities that operate “outside” the legislation, such as informal jobs, started to grow again in 2021, but the signs of the economy do not point to the absorption of this sector into the formal market, assessed the president of the Brazilian Institute of Competition Ethics (ETCO), Edson Vismona, in an interview with CNN this Tuesday (7).

This year, the undeclared amount moved by informal workers was R$ 1.3 trillion, almost 17% of the Brazilian GDP, according to data from a survey carried out by the Getúlio Vargas Foundation (FGV) and by ETCO.

The group of informals analyzed includes both those who carry out legal activities, such as selling food at bus stations or undeclared services in general, and those who work in the illicit market – such as the sale of counterfeit or contraband products, for example.

For Vismona, there is a known movement of “seesaw” in the informal market, and it is common for informality to grow in times of economic downturn. However, there are no signs of a reversal of this trend in the near horizon.

“The pandemic was a point outside the curve, it affected any and all economic activity. With the resumption, we quickly identified that informality is expanding its space, but the economy is not, according to the indices, evolving at levels that can further absolve formal employment”, said Vismona.

“Informality is starting to grow because the economy is not responding to growth in terms of incorporating and expanding the labor market”, he said.

For the president of ETCO, it is necessary to encourage measures for accessing this portion of the population to formalization, since, with this, access to benefits such as social security programs can be guaranteed.

“We have to maintain existing measures, such as SIMPLES, MEI, the facilitation for people to be regularized by paying a lower tax”, he said.

“This is important. We have these mechanisms and we must continue to encourage this entrepreneur to formalize. On the other hand, we have to act to make the space of illegality difficult”, said Edson Vismona.