Brazil's 'new middle class' struggles as economy plunges

lunes 12 de octubre de 2015 11:43 GYT

By Asher Levine

SAO BERNARDO DO CAMPO, Brazil Oct 12 (Reuters) - Until recently, Lucinelia de Jesus Souza's future seemed bright, running a small coffee shop that caters to factory workers and other blue-collar customers in this industrial suburb of São Paulo.

But the faded pink counters of her shoebox-sized business, which opened a decade ago and blossomed as Brazil's economy grew quickly, now see fewer customers stopping in for coffee or deep-fried pastries.

Her income has fallen by half since 2012, forcing the 43-year-old to cut the sort of spending that once heralded an emerging new consumer class in Latin America's biggest country.

With the economy in recession and her husband's job at an auto-parts factory uncertain because of growing cutbacks among local carmakers, trips to the mall for name-brand clothes are on hold, along with plans to buy home appliances.

Gone too is Sunday lunch out with her family, a recent but cherished tradition.

"It was false growth," says Souza, summing up the outlook of many who feel let down by a lost promise. "People here are losing their jobs, they are fed up."

After a commodities-fueled boom that allowed Brazil to finance ambitious poverty-reduction programs and peaked with economic growth of 7.5 percent in 2010, Brazil is in its worst recession in nearly three decades.

During the boom years, tens of millions of Brazilians escaped poverty and became known as "the new middle class." Their ability to buy items like cars and flat-screen TVs for the first time further fueled economic growth.   Continuación...