Technological changes such as automation, digitalization, and artificial intelligence are transforming labor markets worldwide. In Brazil, these transformations pose particular challenges due to the high share of workers in low-skilled occupations and persistent labor market inequalities.

Informality remains a central feature of the Brazilian labor market, affecting around 38 percent of the workforce. Although the country experienced a significant decline in informality during the 2000s, mainly due to rising education levels, progress has since stagnated. Informality continues to...