Boyden Executive Search

Brazil´s macroeconomic context and its Impact on the labor market.

As an important part of our executive search work, Boyden in Brazil conducts a yearly salary survey aimed to better understand the benefit and compensation practices for a number of executive positions in different sectors of activity in the Brazilian economy. This is the 38th edition of the survey, which takes as reference salaries of April 2017. It is a pleasure to share the content of this study with the 148 participants and client companies. For more information email tfumis@boyden.com or telephone +55 11 3382 8300 and ask for Túlio Fumis, or any Boyden Partner.

By Boyden Brazil

Brazil´s macroeconomic context

After eleven consecutive quarters of recession, the Brazilian economy is now showing incipient signs of recuperation.

A trajectory of growth is practically consolidated, however its pace is very slow and the recovery of previous losses is likely to take several years. There remains much uncertainty about government policies and their long term effects, which inhibits risk-taking and investments in the private sector.

On one hand there are forces at play which contribute to a substantial decrease of inflation, such as the falling prices of food commodities due to record harvests, the fall of the US dollar relative to most currencies including the Real, generalized confidence in the Brazilian Central Bank’s policies and the recession itself which has stifled price increases.

One of the consequences of this fall in inflation is the lowering of interest rates at a faster pace than was thought possible, contributing to a decrease in the indebtedness of businesses and individuals, increasing their propensity to spend. Thus we have seen improvements in indicators of retail activity, industrial production and investment plans. Indeed most observers expect the last quarter of 2017 to be the best of the year.

On the other hand unfortunately we also see a series of negative factors at play, especially the strong impact of Brazil’s political crisis on the economy. Important reforms have been delayed in such areas as taxes, labor legislation and social security which impede long-term growth. Added to this is the current extreme under-utilization of productive resources and record levels of unemployment, all of which tend to negate the positive factors mentioned above.

Thus it is to be desired that Brazil accelerate its fiscal and political reforms, thereby creating the environment of confidence and stability needed to generate a well-founded virtuous cycle of development, permitting the country to regain the investment grade of its debt and resume its place among the world’s leading economies.

Executive mobility in the Brazilian market

We still see a slow market for the hiring of executives in Brazil, though the worst now seems to have passed.

Some sectors have begun, more quickly than others, to fill positions left empty and/or re-consider investment projects which were postponed in recent times due to recessionary pressures.

Short-term cost reduction programs of the recent past, which resulted in dismissals at the executive level, are being substituted by plans of gradual hiring, with the objective of preparing organizations for a new cycle of growth.

Thus we are seeing a modest window of opportunity opening now for executives looking for new challenges. We expect this to be true through 2018 and 2019, possibly accelerating if the political and economic elements mentioned align positively.

Executive compensation survey

This is the 38th Annual Executive Compensation survey realized by Boyden Brazil. It is made up of information and analyses based on data supplied by 148 participating companies. The survey´s base-date is April 2017. All the companies which participated are in the private sector, mainly in the South and Southeast of Brazil. Taken as a whole, they well represent the most advanced part of the Brazilian economy.

The information of survey participants is divided into three different groups, according to their annual revenues, as shown in the following table:

As an important part of our executive search work, Boyden in Brazil conducts a yearly salary survey aimed to better understand the benefit and compensation practices for a number of executive positions in different sectors of activity in the Brazilian economy. This is the 38th edition of the survey, which takes as reference salaries of April 2017. It is a pleasure to share the content of this study with the 148 participants and client companies. For more information email tfumis@boyden.com or telephone +55 11 3382 8300 and ask for Túlio Fumis, or any Boyden Partner.

By Boyden Brazil

 

Brazil´s macroeconomic context

After eleven consecutive quarters of recession, the Brazilian economy is now showing incipient signs of recuperation.

A trajectory of growth is practically consolidated, however its pace is very slow and the recovery of previous losses is likely to take several years. There remains much uncertainty about government policies and their long term effects, which inhibits risk-taking and investments in the private sector.

On one hand there are forces at play which contribute to a substantial decrease of inflation, such as the falling prices of food commodities due to record harvests, the fall of the US dollar relative to most currencies including the Real, generalized confidence in the Brazilian Central Bank’s policies and the recession itself which has stifled price increases.

One of the consequences of this fall in inflation is the lowering of interest rates at a faster pace than was thought possible, contributing to a decrease in the indebtedness of businesses and individuals, increasing their propensity to spend. Thus we have seen improvements in indicators of retail activity, industrial production and investment plans. Indeed most observers expect the last quarter of 2017 to be the best of the year.

On the other hand unfortunately we also see a series of negative factors at play, especially the strong impact of Brazil’s political crisis on the economy. Important reforms have been delayed in such areas as taxes, labor legislation and social security which impede long-term growth. Added to this is the current extreme under-utilization of productive resources and record levels of unemployment, all of which tend to negate the positive factors mentioned above.

Thus it is to be desired that Brazil accelerate its fiscal and political reforms, thereby creating the environment of confidence and stability needed to generate a well-founded virtuous cycle of development, permitting the country to regain the investment grade of its debt and resume its place among the world’s leading economies.

Executive mobility in the Brazilian market

We still see a slow market for the hiring of executives in Brazil, though the worst now seems to have passed.

Some sectors have begun, more quickly than others, to fill positions left empty and/or re-consider investment projects which were postponed in recent times due to recessionary pressures.

Short-term cost reduction programs of the recent past, which resulted in dismissals at the executive level, are being substituted by plans of gradual hiring, with the objective of preparing organizations for a new cycle of growth.

Thus we are seeing a modest window of opportunity opening now for executives looking for new challenges. We expect this to be true through 2018 and 2019, possibly accelerating if the political and economic elements mentioned align positively.

Executive compensation survey

This is the 38th Annual Executive Compensation survey realized by Boyden Brazil. It is made up of information and analyses based on data supplied by 148 participating companies. The survey´s base-date is April 2017. All the companies which participated are in the private sector, mainly in the South and Southeast of Brazil. Taken as a whole, they well represent the most advanced part of the Brazilian economy.

The information of survey participants is divided into three different groups, according to their annual revenues, as shown in the following table:

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