Research by FGV and Duke University indicates a decrease in optimism among Brazilian entrepreneurs

12 September 2013

The optimism of Brazilian entrepreneurs towards the economy of the country decreased in the third quarter this year. That is according to the fifth edition of the research Overall Business Outlook - carried out in a partnership between FGV, Duke University and CFO Magazine, with the support of BMFBovespa and the Brazilian Institute of Finance Executives (IBEF).

According to the study, this is the lowest level reached by the index since the beginning of the historical series, started in 2012. This strong decrease in optimism suggests that the economic performance in the next quarter may be below what we expect, says the co-director of research and professor of FGV's São Paulo School of Economics (EESP), Klenio Barbosa.

The decline of optimism in Brazil makes us uneasy. The nature of our index seems to make it anticipate economic performance, says Klenio.  Among the main concerns of Brazilian executives are exchange rates, the tax code and governmental policies ? mainly the monetary one. The Brazilian economy seems to be in a critical moment. Thus, it is inevitable that all attention turns to the conduction of the economic policy, emphasizes Gledson Carvalho, also a professor at EESP and co-director of the Global Business Outlook research.

Within the undefined scenario, the research has further identified a stronger trend of temporary employment increase. Among the main reasons are higher wages for permanent workers (a reason indicated by 47% of the companies that have increased the number of temporary workers) and the economic uncertainty (indicated by 27% of the companies). It seems that, with the emergence and consolidation of the scenario of growth uncertainty, companies are being more cautious and preferring to replace permanent by temporary employment, analyzes Gledson.

However, the improvement of optimism among North-American and European entrepreneurs suggests that better days may be yet to come. The consistent increase of optimism in the United States and Europe gives us hope with respect to the recovery of the world economy and the opportunities that this creates for emerging economies, ponders the research's director and Finance professor at Duke University, John Graham.

Click here to learn more about the research and the results of other countries and continents (available only in English).


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