Brazilian families reach the 2026 elections with more jobs, income and debt

Brazilian families arrive at the 2026 elections with more jobs, income and debts than in previous years of presidential votes.

While the job market showed recovery after the pandemic crisis, the rise in interest rates to contain inflation tightened the household budget, which helps explain the debt and default situation, analysts say.

Contrasts have been explored in the presidential campaigns of Luiz Inácio Lula da Silva (PT) and Flávio Bolsonaro (PL). The current president sought to highlight the records of employment and income, while the senator tried to draw attention to the pressure of debt and the cost of living.

The two candidates appear as favorites in voting intention polls before the first round, which takes place this Sunday (4).

Fabio Bentes, chief economist at CNC (National Confederation of Commerce in Goods, Services and Tourism), says that, anywhere in the world, if the population remains employed and makes gains in consumption and quality of life, the scenario tends to contribute to the re-election of a ruler.

The issue, according to him, is that Brazil arrives this Sunday with mixed signs in the economy, which brings uncertainty to electoral projections. The assessment is a reference to differences in the labor market and debt contexts.

"It makes sense that the dispute is as fierce as it is for the federal government and in most states," he says.

CNC data indicate that, in August, 82% of families had outstanding debts, the highest level in the historical series started in 2010. The indicator includes financial commitments with credit cards, overdrafts, vouchers, loans and others.

Considering only the months of August, the percentage was 59.1% in 2010, 63.6% in 2014, 60.7% in 2018 and 79% in 2022. These are the years of the previous presidential elections in the country.

When the survey only considers families with overdue (default) accounts, the proportion was 29.9% last August. The peak of the series occurred in September and October last year (30.5%). The share was 29.6% in August 2022.

Another indicator is that of families who indicate that they are unable to pay outstanding bills.

In August 2026, 12.5% ​​were in this condition, a higher level than four years ago (10.8%). The peak of the series occurred in October 2025 (13.2%).

"This scenario highlights the impact that the monetary tightening [high interest rates] had on families", says Bentes.

"Families are not going into debt to consume. They are going into debt for another reason: the history of past debts makes budget rebalancing very difficult."

The basic interest rate (Selic) is 13.75% per year. The high level reflects the attempt by the BC (Central Bank) to contain inflation after the economy was stimulated, in part, by government measures.

Even with the tightening of interest rates, the job market continues to show signs of strength.

Brazil's unemployment rate stood at 5.3% in the three months to August. It is the lowest level for this quarter in the IBGE (Brazilian Institute of Geography and Statistics) historical series, which began in 2012.

The number of people aged 14 or over engaged in some type of work (formal or informal) was 103.5 million up to August. It is the largest ever recorded by IBGE.

On average, the employed population had an income of R$3,777 per month. The value is a record for the quarter ended in August.

For Sergio Vale, chief economist at consultancy MB Associados and columnist for Folha, the economic scenario, in general, is still favorable for the Lula government in its search for re-election.

In this sense, Vale cites the impact of variables considered relevant such as the drop in unemployment and recent signs of a respite in inflation.

"What is negative, and which potentially affects the government's popularity, is the issue of default. There is a combination of high interest rates and an indebted population, in addition to the effect of bets, which also affects default."

The release of credit continues to grow in the country, but it occurs in an environment of greater pressure on budgets and is based on more expensive lines, according to an article published on Wednesday (30) on the Ibre Blog (Brazilian Institute of Economics of the Getulio Vargas Foundation).

"The proportion of indebted families, income impairment and bank defaults are at record levels or very close to them, and the pressure is especially intense among lower-income families", says the text signed by researchers Pedro Avelino, Flávio Ataliba Barreto and João Mário Santos de França.

Nursing technician Luana Dutra Gomes, 37, experiences these difficulties. She claims that she was already on a tight budget due to a loan linked to her salary from a formal job when she was the victim of a digital scam last year.

According to the worker, two other credit transactions were fraudulently taken out in her name at the time. Luana was unable to deal with the financial costs and says she will try to resolve the case in court.

"My name got dirty. I couldn't pay my card, I couldn't do anything else, I got stuck in debt", he says. She sold belongings, uses odd jobs and receives food donations to survive.