Plan to drag Portugal’s minimum wages up

By TPN/Lusa, in News · 08-11-2019 01:00:00 · 3 Comments
Plan to drag Portugal’s minimum wages up

The new government plans to raise minimum wages in Portugal, as new data reveals the country has one of the lowest minimum wages in Europe.

Portugal continues to be one of the European Union countries where the national minimum wage is among the lowest, despite the updates of the last four years, which raised the minimum wage by almost 19 percent in nominal terms.

Among the 22 European countries that updated the minimum wage in 2019 through legislation, Portugal ranks 12th, according to a study conducted by the Office of Strategy and Planning of the Ministry of Labour.


The minimum wage in Portugal has increased over the last four years from €505 in 2016 to €600 in 2019, a nominal increase of almost 19 percent and real (excluding inflation) of 14 percent.


According to the study, Portugal is “among the countries with the lowest minimum wage in both the EU and the Eurozone” and “the recent increases in the minimum wage in Portugal do not change its relative position” in the European “ranking”.


According to the table that presents nominal values and adjusted to monthly values (12 months) and taking into account the various rules in the member states, Luxembourg is at the top, with a minimum wage of €2,071.10 a month, that is, almost three times the Portuguese.
Secondly, the United Kingdom has a minimum wage of €1,746.70. Ireland, the Netherlands, Belgium, Germany and France are still in the top €1,500 bracket.


Portugal, whose adjusted value at 12 months is €700, is still below Spain (€1,050), Slovenia (€886.60), Malta (€762) and Greece (€758.30).


Portugal’s minister of labour, solidarity and social security, Ana Mendes Godinho, has expressed her confidence that it will be possible to reach an agreement in social consultation on the evolution of the minimum wage for 2020.


“Our goal is to reach €750 by 2023 and by then we will have a discussion and debate year by year on what the minimum wage is each year,” she said.


However employers have called on the government to be realistic in their minimum wage targets.
The president of the employers confederation CIP (Confederação Empresarial de Portugal), António Saraiva, considered ambitious the government’s target for the minimum wage and asked the executive to be realistic and give conditions for companies to be able to support the increase.


“We will listen to the government on what it has to say about the target that it has set and I hope it puts equal ambition in economic growth,” said António Saraiva, at the start of the Social Dialogue meeting, where partners will discuss the increase in the minimum wage for 2020.


“We have to be realistic, we have to give sustainability to companies,” he said.

“The economy is managed by different signals than the decrees that some governments insist on making and therefore we want to discuss conditions that allow companies to sustainably achieve the wage objectives that we all want,” Saraiva said.


The secretary-general of trade union CGTP, Arménio Carlos, pointed out that the increase in the minimum wage in recent years has had positive effects on the economy and has once again demanded €850 as a target.


The leader of trade union UGT, Carlos Silva, defended greater ambition in the figures,and that the union wants €660 for 2020.
The national minimum wage is €600 this year.



Comments:

Wages depend on productivity, so there is a link between this and the level it is profitable to set the minimum wage at. The article talks as if wages are randomly determined, and totally independent of productivity! It demonstrates a total lack of understanding as to how the economy functions. For instance, Portugal cannot simply set a EUR 2,000 monthly minimum wage tomorrow, as this would be totally out of line with productivity and cause employers huge losses, leading to massive lay-offs. There is a reason why Luxembourg is at the top, and Portugal so far down the list. The article fails to explore this.

by Billy Bissett from Algarve on 10-11-2019 05:32:00

This minimum wage in the UK only applies if you’re on a 40 your week! There’s so many zero hour contracts you can be earning as little as about £120 a week with no top up. It’s far more expensive also. This is really misleading!

by Mel from UK on 08-11-2019 05:29:00

All the data is wrong

UK's minimum wage for people over 25 sits at £1300 which equals 1525€

Minimum wage in Spain is 900 euros per month.
Workers with a permanent contract (only 15% of new contracts signed in Spain) have the right to doubble pay in July and December.

by Roberto Gonzalez from UK on 08-11-2019 05:29:00
Interactive Topics, send us your comments/opinion on this article.

Please note that The Portugal News may use selected comments in the printed edition of the newspaper.