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Minimum wage strengthens the economies of small and medium sized cities

Raise and ensure real increases of the minimum wage directly benefited the North and Northeast regions of the country, precisely those with the highest percentage of workers whose income is at that level. In the Northeast, for example, where almost half of Brazilian workers and retirees who receive a minimum wage live, according to PNAD 2012, the increase in average income of the population was 5.4%, well over the national average, attracting new private investment and giving the regional economy new impetus.

Retailers feel the positive effects more, with large groups opening outlets in medium-sized cities in the North, Northeast and Center-West and multiplying their chain stores in capital cities and metropolitan regions. At the end of 2013, the payment default rate of the sector was at the lowest levels recorded in this century, falling from 5.7% to 4.5% in the previous year, according to a study conducted by the Credit Protection Service (SPC Brasil) and the National Confederation Retail Store Managers Confederation (CNDL).