Brazil is Global Bright Spot
If there’s a global bright spot for information technology jobs, it’s Brazil. The country has a bustling economy and thriving IT sector and it needs thousands and thousands of IT professionals.
The Federative Republic of Brazil is South America’s largest and most populous country and the world’s fifth-largest country in terms of land mass and population. Furthermore, it’s the world’s seventh-biggest economy, and with a 7.8 percent growth rate last year, exceeds many countries in the world.
Brazil is tied with India as the second-most-popular country for business investment, said Mauro Peres, who leads IDC’s research services and thought leadership for IT, telecom, and vertical market services in Brazil. And its economic momentum will be helped even more by its preparations to host the 2014 World Cup and 2016 Olympics. In preparation, the country is investing billions in infrastructure, tourism facilities, transportation, and security services and systems.
Double-digit growth rate
Because the IT sector serves all sectors, the World Cup and Olympics will help generate jobs, said Antonio Gil, president of Brasscom, the Brazilian Association of Information Technology and Communication Companies. “Brazil is a land of opportunity,” he said.
According to Gil, Brazil’s IT market, not including communications, amounted to (US) $80.1 billion in 2010. His organizations estimates that the IT market is growing at a rate of about 13 percent per year and that by 2020, it will represent from (US) $150 to 200 billion to become the world’s fifth-largest IT market.
IDC’s research provides a comparable view. Peres said his firm anticipates a 12 percent annual growth rate for Brazil’s IT market—double the worldwide IT market’s 6 percent growth rate.
Brazil is expected to pass Japan to become the world’s third-largest PC seller, driven by purchases among the lower middle class, whose improving incomes are allowing them to buy their first PCs. The country is the world’s fourth-largest for mobile phone and telecom sales. Residents are computer-savvy and heavy users of the Internet and social networking sites, and these characteristics will increase as more people gain access to broadband services and the financial means to connect online.
IDC characterizes national IT markets based on the relative consumption of hardware, software, and services. As an IT market begins to grow, it requires hardware for infrastructure, and as it matures, its investments in hardware slow, and spending on software and services increases. Brazil is in the middle phase of the maturation process, Peres said, because hardware drives about 60 percent of its market. In comparison, 80 percent of China’s immature IT market is spent on hardware.
There’s much more growth in Brazil’s IT sector to come, in other words, and as the Brazilian market matures, it will shift more and more to software and services. “Applications in financial services, e-government, energy, manufacturing, and agriculture are among the most sophisticated that you can find,” said Brasscom’s Gil.
Hot market for talent
This bustling IT business in Brazil has created a tremendous market for IT professionals and the country has been gaining attention as a hot market for talent.
Right now, the country currently employs around 1.2 million professionals in IT, according to Gil. But the country needs to find IT professionals to fill about 70,000 to 80,000 new jobs per year and this level of annual demand is expected to continue for at least a few years. Based on research conducted by Brasscom, 2010 IT hires were systems analysts, computer support analysts, systems programmers, equipment maintenance technicians, help desk staff, network analysts, computer operators, tele-processor network operators, automation analysts, and Internet programmers.
IDC’s Peres noted that the country has the third-largest installed base of mainframes in the world, in part because of its strong financial industry, and therefore the country requires a lot of people who can work on mainframes, as well as Cobol programmers. Brazil also has one of the biggest Java communities in world to serve its Internet-based systems and services and it needs people with relevant skills for this work. It also needs people proficient in SAP, which has a healthy and growing market in the country.
Language can be an issue
Because Portuguese is the official and most widely spoken language in Brazil, language can become an issue for some IT workers from other countries. For example, the rest of South America is Spanish-speaking, and this is a “real problem for Brazil,” according to Osvaldo Perez, an IEEE Computer Society member and Member & Geographic Activities Board member for Latin America. “This delays Brazilian projects in South America,” he said.
Those who know English, on the other hand, have advantages. “People who know both technology and English definitely have a lot of opportunities to work in Brazil,” said IDC’s Peres. “They won’t have any problem finding jobs.”
This advantage applies particularly to offshore projects. If an IT professional has English-language skills, is a good programmer, and knows SAP, they should be able to find a job working on international projects from Brazil, he said.
Bureaucratic red tape
While the plethora of job opportunities in Brazil may sound alluring to IT professionals from other countries, bureaucratic red tape needed to obtain work visas can be discouraging because the process is cumbersome. However, the process may ease up some because of the need for talent, especially in critical, high-growth sectors, Gil noted.For example, he said Brazil is investing (US) $200 billion in IT for oil research to support exploration for deep-sea oil reserves and needs software engineers and others with related experience who may need to be brought in from other countries for these roles. While Gil cautions that people pursuing these types of positions won’t get a work permit automatically, the government has made it easier for companies to import talent.
Grand plan for IT
IT professionals in Brazil should pay close attention to a new policy, called the Plano Brasil Maior, or the Bigger Brazil Plan, which is designed to spur business growth, build a trained workforce in IT and other fields, and help turn Brazil into an innovation-based economy. The policy will take effect before the end of the year.
A major component of the Plano Brasil Maior is a reduction in payroll taxes, which are now among the world’s highest. The taxes discourage companies from hiring full-time workers and impede the country’s ability to compete internationally and export more goods and services. The plan will drastically lower these taxes to encourage hiring. It will provide substantial investments in infrastructure to expand broadband coverage.
The plan will also make educational financing at very low interest rates available to young professionals and students, in part to help train an IT workforce. The goal is to train 400,000 people in IT by 2014. The plan will also support programs to send graduates from Brazilian colleges to leading universities overseas to pursue advanced degrees, on the premise that these professionals will return to the country to develop new technologies and services and, perhaps, transform Brazil into a society that fosters and thrives on innovation.
However IDC’s Peres cautions that the plan’s intentions to help labor and IT professionals may not satisfy all workers. Under the current regulations, to avoid paying payroll taxes and benefits, many firms hire full-time employees as independent contractors. While the reduced taxes will make it less expensive for companies to hire full-time workers, Peres said many professionals prefer having independent contractor status and the autonomy it provides and actually may not want formal employee status.
“At the end of the day, if companies become more competitive worldwide and we export more, there will be more job openings, but it is too early to say that,” he said. (CW) (30 December, 2011)