Brazilian Welfare Reduction And Poverty During COVID-19

In December 2020, the Brazilian government withdrew a series of welfare packages intended to offset unemployment and healthcare costs due to the COVID-19 pandemic. The package was one of the most generous internationally and was intended to reduce the economic crisis and the socioeconomic turmoil among the Brazilian population. Since the removal of the package in late 2020, a large portion of the Brazilian population has been faced with a depleted job market and elevated food and living costs. This has resulted in mass homelessness and impoverishment of inner city and rural populations, who are simultaneously battling the rapid spread of the COVID-19 virus. Mass encampments have arisen, such as the Penha neighbourhood in Sao Paulo. Over 200 families in the area live in temporary shelters made from collected wooden boards and other found objects. The dense and dilapidated living conditions of these temporary neighbourhoods are the perfect environment for COVID-19 outbreaks, along with many other risks.

These temporary neighbourhoods are not uncommon in Brazil. The favelas (slums found within the inner cities of Brazil) that emerged within Sao Paulo have attracted a vast number of individuals who can not afford the cost of living. Along with ethnic enclaves, these favelas are often viewed as poverty hotspots within the city. The rise of COVID-19 and the reduction of government aid has increased the populations in the favelas while also creating mass COVID-19 risks and dangers.

The welfare package was worth almost 300 billion Brazilian real (US$60 billion) and was received by 68 million people. This was in an effort to reduce economic losses due to labour and operational restrictions. However, when Brazilian President Jair Bolsonaro lifted and denounced restrictions controlling COVID-19 numbers, the welfare package was withdrawn, creating a spike in unemployment and poverty amongst the population. The welfare program was reinstated in April 2021, but only two-thirds of previous recipients were reached.

The vast majority of the city’s inhabitants are forced to work for low wages in the industrial and manufacturing sectors. This is due to a rapidly declining employment rate and a large working population. In recent years, in an effort to become a globalized city, Sao Paulo has begun to deindustrialize the city centre and spatially relocate the majority of the industry to rural areas. This has led to a rise in unemployment rates and socio-legal fragmentation. Impoverished populations are at higher risk of these challenges as people are more likely to hold positions within these sectors while limited policies protect them.

The poverty and unemployment rates reached massive highs in the first quarter of 2021 as the population scrambled to maintain a living wage in spite of the decreasing job market and increasing health risks. The spread of COVID-19 has rapidly increased in 2021, and the healthcare system has become overwhelmed by the number of cases and deaths within the country. This has in turn furthered the collapse of the economy. Those who are fortunate enough to gain and maintain a job and who can not afford to remain unemployed must risk their health and safety to earn enough money to accommodate the rising costs of food, supplies, and housing. Many are unable to support the high costs of living and are therefore forced into poverty.