Over half a million people on minimum wage
The number of Portuguese workers who earn the national minimum wage (€485) has more than doubled in just four years to a total of 605,000 people. According to the latest statistics by the Portuguese Social Security, which date from April last year, one in 11 workers earns just €485 a month. This accounts for more than 10% of the active population.
Although the minimum salary is exempt from taxes such as IRS, workers still have to pay 11% to Social Security, which leaves them with a net salary of €431.65.
In 2007, before the recession kicked in, the percentage of workers earning the minimum wage (€403 at the time) was less than 5.5% of the total active population. From the 5.1 million people who were employed during the first quarter of 2007, only 282,000 were earning the minimum pay, whilst in the first quarter of 2011, from the 5.5 million existing workers, 605,000 people received the national minimum wage. The figures reflect a rise of 115% of the number of people earning the minimum wage, whether self-employed or not, which means an average increase of over 80,000 people.
According to the figures, women are still subject to gender discrimination when it comes to their pay: 14.9% receive the minimum wage compared to 8.1% of men.
Portugal gives lowest wage
From the four EU countries that have asked for a bailout – Greece, Ireland, Portugal and Spain –, it is Portugal that has the lowest minimum wage. Greece’s minimum pay was cut by 22% from €751 to €585.79 due to the austerity measures, whilst the Spanish earn a gross income of €641.50 a month. On the other hand, Ireland has the highest minimum pay of all four countries and one of the highest of the EU (€1499.33 for a 40-hour working week), only surpassed by Luxembourg (€1801.49). In the UK, the national minimum wage is £1053, approximately €1300. Eastern European countries earn the lowest national minimum incomes, with Romanian workers, for example, taking home €156.66 a month.
In a recent study, Portuguese economist Eugénio Rosa noted that the average net monthly income of Portuguese workers in 2010 was no higher than €777.