Brazil's jobless rate ends 2016 at 12 percent with 12.3 million unemployed

BRASILIA (Reuters) - Brazil’s jobless rate rose to a new record high in the fourth quarter as companies continued to cut staff after two years of a deep recession, government data showed on Tuesday.

Brazil’s jobless rate rose to 12.0 percent in the three months through December, equivalent to 12.3 million people, the government’s statistics agency IBGE said.

The unemployment rate was slightly above market expectations in a Reuters poll, which forecast a jobless rate of 11.9 percent. It stood at 11.8 percent in the third quarter.

Wages discounted for inflation rose 0.8 percent from the third quarter to 2,043 reais ($658.20) a month on average.

Brazil’s unemployment rate has risen steadily after the country plunged into its worst recession in history. Separate government data showed earlier this month that companies cut more than 2.8 million payroll jobs over the past to years.

Economists with São Paulo-based research firm Rosenberg & Associados expect the unemployment rate to continue rising in 2017 as the pace of job creation will probably be insufficient to meet the rising number of people looking for jobs in a scenario of growing confidence but still slow economic recovery.

“Our expectation is that the unemployment rate will reach 13.4 percent in the first quarter and 13.2 percent in the second,”, they wrote in a research note.

Reporting by Silvio Cascione; Editing by Chizu Nomiyama