Brazil's Retail Sector Cuts 46,000 Jobs in First Half of 2026

Brazil's retail trade eliminated 45,900 formal jobs between January and June 2026, marking the largest cut for a first semester since the pandemic. This decline occurred while the general labor market grew, creating 921,000 jobs during the same period according to Caged data. The retail sector was the only major sector to eliminate positions, contrasting with growth in services, construction, industry, and agriculture.

Experts attribute the decline to a combination of high interest rates, a weakening economy, the growth of e-commerce, and the rise of online betting. Specifically, clothing and accessory stores saw the largest drop with 30,900 jobs cut, followed by footwear stores and supermarkets. The situation is further complicated by the recent judicial recovery request from Casas Bahia, which announced the closure of 298 stores and the dismissal of approximately 3,000 employees.

Financial data from the Central Bank highlights rising costs for consumers. Interest rates for individuals with free resources rose to 64 percent per year in June, up from 59.4 percent a year prior, while credit card interest reached 97.4 percent. Economists suggest that these costs heavily impact durable goods like furniture and electronics. Additionally, a study by Peers Consulting indicates that 23 percent of online bettors reduced spending on clothing and footwear, while 19 percent cut supermarket expenses.

While the retail sector overall struggled, the impact was mitigated by wholesalers and companies selling automobiles and motorcycles, which benefited from the growth of transport and delivery apps. Analysts expect the retail sector to end 2026 with a net job balance near zero.