Living and working in Portugal

The Consumer Price Index rose by 4.3% (compared with 7.8% in 2022), with a decrease in most product categories, while the House Price Index rose in the third quarter of 2023, by 7.6% year on year.

Compared with 2022, when agreed wage increases covered only around 25% of workers in the private sector, recent data from the first, second and third quarters of 2023 show a similar problem, pointing to the weakness of collective bargaining when it comes to improving real wages. Nevertheless, average nominal remuneration (declared to Social Security) increased by 7.2%. This is well above the 5.1% benchmark for 2023 established by the Medium-Term Agreement for Improving Income, Wages and Competitiveness, signed by the government and the social partners in October 2022. It seems that the most important influence on the general increase in average wages was the increase of the national minimum wage to €760 (by 7.8%) in 2023.

In 2023, Law No. 13/2023 of 3 April, the so-called Decent Work Agenda, entered into force. This legislation includes significant changes to the Labour Code, including new criteria for the recognition of labour contracts within the scope of digital platforms, extension of bargaining rights for economically dependent self-employed, restrictions to temporary agency work and outsourcing, improvements in employment protection, increasing overtime payments, improving work–life balance and working time flexibility, new forms of arbitration, and reinforcement of the powers of labour inspection. This legislation also ensured the transposition of the EU directives on transparent and predictable working conditions and on work–life balance for parents and carers into national law. A pilot project on a four-day week was also launched with the support of the government.

The number of strikes and demonstrations in the public and private sectors increased. In the public education and health sectors, the conflicts related to wages, career prospects, recognition of seniority rights, intensification of work and excessive overtime hours. These strikes were organised not only by established trade unions in those sectors, but also by new emerging unions in the case of teachers and new movements in the case of doctors. Ongoing budgetary restrictions affected both the capacity and service quality of the National Health Service and the education system. Labour shortages increased the career of doctor, nurse and teacher become increasingly unattractive in terms of wages, stability and working conditions. Most of these issues will be up for discussion and on trade unions’ agendas again in 2024.

On 7 November 2023, the prime minister, António Costa, announced his resignation following an investigation following allegations of influence-peddling by his former chief of staff, among others. President Marcelo Rebelo de Sousa responded by dissolving the parliament after the final approval of the state budget bill for 2024 and calling a snap parliamentary election for 10 March 2024. Until then, the government will remain in place with reduced powers.