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By Jamie McGeever
BRASILIA, Nov 29 (Reuters) - Brazil’s jobless rate fell to 11.6% in the three months through October, statistics agency IBGE said on Friday, the lowest level this year and a sign that the high degree of slack in the labor market may gradually be shrinking.
The fall from 11.8% in the three months to September was in line with expectations, according to a Reuters poll of economists, and marks a decline of more than one percentage point over the last seven months.
Economists note that the high unemployment rate and underemployment indicators reflect a large amount of slack in the labor market. In cutting interest rates to a new low of 5.00% last month, the central bank warned that “inertia” in the economy could help keep inflation lower than it would like.
But the latest figures, which appear to incorporate recent months of payroll job growth, point to people returning to the workforce and an overall improvement in the labor market, albeit a very gradual one.
“There are signs of a trend here,” said Jason Vieira, chief economist at Infinity Asset Management in Sao Paulo. “There will be a further improvement into the year end too,” he said, predicting a decline in the unemployment rate to 11.3%.
The number of Brazilians out of work in the three months to October was 12.4 million, statistically unchanged from the preceding three months and the same period a year ago, IBGE said.
The underemployment rate, which hit a record 25% earlier this year, fell 0.8 percentage point to 23.8% from the preceding quarter, but again was barely changed from 24.0% in the same period last year, IBGE said.
It was a similar picture with the number of underemployed workers in Brazil: down 972,000 people, or 3.5%, to 27.1 million from the prior three months, IBGE said, but exactly the same as the 27.1 million a year earlier.
The number of formally registered private sector employees held relatively steady at 33.2 million, and the number of self-employed rose to a record 24.4 million, IBGE said. The number of un-registered workers also rose to a record 11.9 million. (Reporting by Jamie McGeever Editing by Chizu Nomiyama)