UPDATE 1-Brazil jobless insurance claims fall in July, but 2020 total still well up on last year

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By Jamie McGeever

BRASILIA, Aug 6 (Reuters) – New unemployment insurance claims in Brazil fell in July, figures showed on Thursday, a sign that the labor market has passed the worst of the coronavirus crisis and a counter point to other figures that suggest otherwise.

New claims totaled 570,543 in July, according to an Economy Ministry presentation, down 12.7% from the month before and 8.8% lower than July last year.

That marked the second consecutive monthly fall in new claims since the record of nearly 1 million in May, although total claims in the first seven months of this year rose 11.1% to 4.52 million from the same period last year, the ministry said.

Economy Minister Paulo Guedes had said on Wednesday that the worst of the hit to Brazil’s labor market from the COVID-19 pandemic was over.

But official unemployment figures for the three months to June released on Thursday painted a much bleaker picture.

The unemployment rate hit a three-year high of 13.3%, while the underlying figures showed a record number of Brazilians out of the workforce, a record low number as a share of the working population in work, and the underemployment rate at an all-time high, statistics agency IBGE said.

The insurance claims figures for July showed that the dominant services sector was still under severe pressure. Retail and other services accounted for around 294,000 of the monthly total, or almost 70%. (Reporting by Jamie McGeever Editing by Chris Reese and Jonathan Oatis)

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