The Portuguese government will propose an increase in the national minimum wage from next year, with an increase of around 4.9%. This proposal will be presented at the Social Concertation meeting, scheduled for Wednesday, September 11th, and aims to continue the effort to increase income, one of the priorities of the current legislature.
The proposed increase slightly exceeds the nominal growth forecast for the economy, which the Government estimates at around 4.5%, translating into an additional €40 per month for workers paid the minimum wage, from €820 to €860. This exceeds the targets established in the income agreement signed in 2022 between the Government of António Costa, the employers' confederations and the UGT.
In 2022, the Government committed to employers' confederations and the UGT to increase the national minimum wage to €855 by 2025. The current proposal of €860 already exceeds this target, reflecting greater ambition given the country's economic circumstances.
The Minister of Labour, Solidarity and Social Security, who will chair Wednesday's meeting, will be accompanied by the Minister of State and Finance, in a session that will be crucial to discuss not only the increase in the minimum wage, but also the income policy for the coming years. The employers' confederations and trade unions will have to present their positions on the government's proposal.
Currently standing at €820 gross per month, the government's goal for the national minimum wage is to reach €1000 by 2028, as presented in the government program in April of this year. Going forward, the government proposed an increase in the average wage to €1750 by 2030, in an attempt to reduce wage inequality and increase families' purchasing power.
This measure is part of a broader strategy to value work and promote social cohesion, in line with the economic recovery that the country has been experiencing, despite global challenges such as inflation and rising energy costs.
The increase in the minimum wage may, however, be challenged by employers' associations, who have expressed concerns about the impact of this measure on companies' costs, particularly for small and medium-sized enterprises (SMEs). The capacity to absorb these increases may be a topic of debate, as employers warn of the need for compensation and support to ensure that this increase does not harm companies' competitiveness.
On the other hand, trade unions, such as CGTP and UGT, have been pushing for the national minimum wage to increase significantly, stressing that the current level of minimum income is insufficient to meet the cost of living, which has been increasing, particularly with the increase in housing and energy prices.
The Social Concertation meeting this week, which will be chaired by Minister Ana Mendes Godinho, will be crucial to the outcome of these negotiations, as the social partners will have the opportunity to present their demands and concerns regarding the economic and social impact of this proposal. The increase in the minimum wage will be one of the central topics on the agenda, but the meeting should also address other measures to support income and promote quality employment.
The government's proposal will certainly be the subject of intense debate, in a context in which the country is trying to balance economic growth and social cohesion.
Source https://postal.pt/ - Photo courtesy of Depositphotos.com
