38% of black Brazilians earn one minimum salary or less; racism is the cause for about 31% of the difference between wages of whites and blacks in Brazil
By Marques Travae
“Almost half of black Brazilians earn one minimum salary or less per month, according to a new study by the consultancy firm IDados based on figures from the agency IBGE for the last quarter of 2019,” says journalist Lauro Jardim. Not that stating it another way would make this grim figure any better, but I would have said that more than one-third of black Brazilians earn between one minium salary and less.
When breaking down these numbers by race, we discover that 38% of blacks find themselves in this financial situation against 21% of whites who fall within this salary bracket, which applies to 30% of Brazil’s workers overall.
So, what exactly does this mean? I would suppose we would need to first define how much minimum salary is to get a fair assessment of this data. At the end of 2019, the minimum salary paid monthly in Brazil was BRL$998, a little less than one thousand Brazilian reais. As of January 1st, the minimum salary went up a little, increasing to BRL $1,039 per month. 1,039 reais per month…Could you live on that?
Let’s put this into more perspective for further understanding for those of us who don’t live in Brazil. As of yesterday, January, 21, 2020, one USD, an American dollar, was worth four Brazilian reais and 21 centavos, which calculated out means that 998 Brazilian reais was worth about 237 American dollars. As of now, since the minimum monthly salary went up to BRL$1,039, the new minimum salary is now worth $246.86 American dollars. So, now the question would be, could you live on less than US$250 per month?
Maybe you’re thinking, well, maybe the cost of living in Brazil isn’t that high. But it IS high. Brazilians earning a minimum salary are realistically
fu…ed…screwed. Whenever I discuss the cost of living in Brazil with my mother, she always asks the same thing…“Can you tell me what that is in dollars?”
To illustrate how challenging it is to earn less than $250 per month, I like to make a comparison of what it costs to eat at one of the world’s biggest fast food restaurants, McDonald’s, in both countries and the percentage of wages an American living on minimum wage would pay vs. a Brazilian earning minimum salary.
In the US, a Big Mac meal containing the burger, fries and a soft drink costs on average about USD$7.85. In Brazil, the same combo will cost about BRL$22.90. In the US, the current minimum wage is USD$7.25…hol’up…Think about that, an American worker has to work more than an hour just to earn enough money to buy a Big Mac meal at Mickey Ds. Insane. In fact, he would need to work more considering he or she will have to pay somewhere between 30-33% of this salary in city, state and federal taxes. But let’s assume that this worker is fully employed, working 40 hours per week. Working 160 hours in a month, that employee will earn about USD$1,160. Thus, it looks like an American and Brazilian worker earning the minimum wage/salary are about in the same boat, right?
You see, at today’s exchange rate of one American dollar equaling four Brazilian reais and 21 centavos, the value of the American monthly salary becomes BRL$4,883 vs. the Brazilian salary of BRL$1,039 per month. Now, consider the percentage of wages that each worker has to pay just to eat at McDonald’s. Now, let’s calculate that the American worker earns USD$290, or BRL$1,221 per week, and the Brazilian worker earns about BRL$259.75 per week. Based on these numbers, I conclude that the Brazilian worker has to pay about 9% of his weekly salary to buy that Big Mac combo in Brazil, while the American worker has to pay only 2.7% of his weekly salary.
In other words, the Brazilian worker has to spend 3.3 times more of his salary for a McDonald’s meal in Brazil than his American counterpart paying for the same thing in the US. Damn shame…So much for the idea that maybe the cost of living is less in Brazil. When you consider that this same calculation can be applied for higher priced items such as clothing, cars, etc. and you see that life is hard if you ain’t bringing in big bank in Brazil.
Another example. Back in 2013, I saw the price of a 2007 Ford Fusion automobile going for BRL$36,000 in São Paulo. I bought that same car in Detroit for USD$7,000. Using the same calculation and considering that the average Brazilian earns around BRL$2,340 per month, vs. the average American that earns USD$3,916 per month (worth BRL $16,489) and you see that life is insanely expensive for most people working and living on Brazilian wages.
All this and I haven’t even figured in the race factor.
A recent study recently revealed that racism was the cause for about 31% of the difference between wages of whites and blacks in Brazil. According to research conducted by the Instituto Locomotiva, by isolating all other variables, it is calculated that structural racism is responsible for generating a salary difference of 31% between whites and blacks holding college degrees. Therefore, the total difference of 45% measured by PNAD (National Household Sample Survey) in 2019 cannot be attributed only to the lack of training opportunities for black people.
This inequality is across the board, regardless of educational attainment. Another study shows that in 2018, the average trabalhador branco, white worker, received about 75% more money than preto, black, and pardo, brown/mixed race workers. The numbers are courtesy of the National Continuous Household Sample Survey (Pnad) of the IBGE agency, released in October of 2019.
Last year, the avergae white worker received BRL$2,897 per month, while blacks and browns had incomes of BRL$1,636 and BRL$1,659, respectively. in other words, the salary earned by white workers was 77% and 74% higher than the salary received by a black and brown person, respectively. And as we can see, pretos and pardos, as literally hundreds of studies over the years have shown, continue to be at the same disadvantage vis-a-vis Brazil’s white population.
And contradicting the idea that education is the great leveling factor, this inequality is maintained when we consider those attaining college degrees.
“It is a persistent inequality that can only be explained by structural racism. On the one hand, it is expressed in racial prejudice. On the other hand, in the largest social capital of whites: the famous ‘who recommends’ a white person is another white person who is in a high position,” says Renato Meirelles, president of Locomotiva, in an interview with the nation’s top newspaper Folha de S. Paulo.
As an example for this reality, Daniel Teixeira, of the non-profit organization Ceert (Center for the Study of Labor and Inequalities), says that many companies have yet to incorporate the racial issue into their diversity programs. “The rule in Brazil is to see the racial issue as the ugly duckling on the agenda of diversity. Something that can be left for later,” he comments. In Teixeira’s view, the focus in terms of diversifying the workforce turned to people with disabilities, due to quotas established by law 8.213/91, and women.
Meanwhile, the percentage of black employees remains disproportionate with their representation in the Brazilian population. According to IBGE data, 56% of Brazilians declared themselves pretos or pardos. Again, this is considering the way Afro-Brazilian activists calculate the black population as being the total of all pretos and pardos, which I don’t think is completely accurate.
For the Instituto Locomotiva, the lack of opportunities leads many blacks to enter the world of entrepreneurship out of necessity rather than simply desire. The Institute calculations based on PNAD indicate that black entrepreneurs are the majority in the country (52%). Whereas about one-fourth of Brazilians want to open their own business, among black people, that rate goes up to one-third.
With information courtesy of Sul 21 and Diário do Centro do Mundo
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