6×1: Reducing scale can now harm workers, says professor

The reduction in work schedules at this time has the potential to be harmful to Brazilian workers given the country's low productivity, says Juliana Inhasz, economics professor at Insper.

To CNN Money, the professor stated that international experience shows that countries first achieve increases in productivity and only then think about reductions in scale.

"It seems unlikely to me that it's feasible to do this," he said, referring to the reversal of this order in Brazil.

The professor warned that, if the reduction in working hours is not accompanied by real gains in productivity, the result could be an increase in costs and inflationary pressures, worsening the context in which the worker is inserted.

"We are, unfortunately, taking the opposite path, betting that this reduction in working hours will lead to increases in productivity, when increases in productivity come through other channels."

And the recent numbers are not positive: the country dropped seven positions in the 2026 World Competitiveness Ranking, prepared by the IMD World Competitiveness Center in partnership with Fundação Dom Cabral.

Brazil now occupies 65th position in a list of 70 economies, which represents the worst level in recent years.

The scenario is worsened by the productivity performance of Brazilian workers. In the first quarter of this year, productivity per hours worked fell 0.5%, even in a context of a heated labor market and low unemployment rates.

For Inhasz, the apparent contradiction between a heated job market and low productivity has an explanation. "Productivity and competitiveness are different things", he stated.

According to her, productivity concerns the ability to improve the efficiency of the production process, while competitiveness refers to the ability to maintain an environment of economic growth that generates benefits for society.

Inhasz highlights that Brazilian growth has been driven mainly by an increase in the production factor - that is, by the insertion of more people into the job market - and not by efficiency gains.

"We put more people to work, but we are not managing to make this work more productive", he said. For her, this is directly related to the lack of investment in technology, innovation and workforce qualification.

The professor also highlights that competitiveness does not depend exclusively on the government. Factors such as bureaucracy, instability in rules and unfavorable economic conditions harm companies' predictability and ability to plan.

At the same time, Juliana Inhasz pointed out that the productive sector also bears its share of responsibility.

"There is a management issue that is also strong", he stated, adding that, often, the incentives offered by public policies are not used by companies to stimulate innovation.

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Source: CNN