Minimum wage will increase and will be R$ 1,294

The minimum wage for 2022 is paid in the amount of R$ 1,212.00. However, the minimum wage that will be paid in 2023 is already included in the draft Budget Guidelines Law (PLDO) and was sent to the National Congress last Thursday, April 14th. In the project, the value of the minimum wage for 2023 is R$ 1.294,00.

The estimate for salary floor adjustment is included in the PLDO and was 6.7%, which, as usual, follows the projection for the National Consumer Price Index (INPC) for the year. Therefore, the increase from 2022 to 2023 would be BRL 72.00.

Next years

There are forecasts for the coming years as well, the project presented estimates that in 2024 the minimum wage will be R$ 1,337.00, in 2025 it will be R$ 1,378.00. As the projections are preliminary, in the coming years they will be reviewed in the PLDO.

Calculation for readjustment

The readjustment of the minimum wage until 2019 was calculated based on a formula that estimated the growth of the Gross Domestic Product (GDP) – which is the sum of the wealth produced in Brazil – of the two previous years plus the official inflation of the previous year.

As of 2020, the wage floor will be readjusted only in accordance with the replacement of the INPC, due to the Constitution, which establishes the review of the purchasing power of the minimum wage.

Impact on the Economy

According to the Ministry of Economy, each BRL 1.00 increase in the minimum wage has an approximate impact of BRL 389.8 million on the budget. This effect is due to the fact that several expenses are linked to the alternation of the floor, such as Social Security benefits, unemployment insurance, salary bonus and the Continuous Cash Benefit (BPC).

The value of the 2023 minimum wage depends on the effective value of the INPC of 2022, therefore, it can still be changed. The President of the Republic has the obligation to publish a provisional measure with the value of the minimum salary until the last day of the year.

The increase in the minimum wage in 2022 compared to 2021 was 10.18%, slightly above the accumulated INPC, which was 10.16%.

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