• 5.5




Key drivers

Wage Pressure in High-Skill Industries (8.3)

The wage gap between high-skilled and low-skilled industries has narrowed. This was driven by falling wages in the financial sector.

Talent Mismatch (8.6)

This is driven by both a fall in the long-term unemployment rate and a fall in the vacancy rate. This indicates there was a better skills match, although the Indicator remains high at 8.6.

Labour Market Flexibility (6.1)

The legal and regulatory framework surrounding the labour market was ranked as slightly less burdensome on employers relative to the other 33 markets in the report.


Education Flexibility


Labour Market Participation


Labour Market Flexibility


Talent Mismatch


Overall Wage Pressure


Wage Pressure in High-Skill Industries


Wage Pressure in High-Skill Occupation


Paula Baptista

Managing Director, Hays Portugal

View from the Ground

The Portuguese economy is experiencing a lot of positivity at present, including the development of innovative projects and receiving considerable amounts of foreign investment. As a result, the unemployment rate has dropped to lower levels. The consequential growth in the skilled labour market has been creating challenges for companies in identifying and attracting the right talent. Skills shortages could be holding back business growth: if companies are unable to find the right talent then they are unable to operate to their full potential. Therefore, it’s important for companies to create competitive retention and attraction strategies to compete for sought-after skills. In addition, it’s crucial for firms to try and attract professionals who have left the country, especially the younger generation who emigrated in recent years, as this has had an impact on the working-age population.

Paula Baptista, Managing Director, Hays Portugal

Key Skills in Demand

  • Full Stack Developers
  • SAP Consultants
  • Automation & Robotics Engineers
  • Export Managers
  • Certified Accountants

Market Insight

The Portuguese economy performed strongly in 2018, with GDP growth of 2.2%, which is higher than the average growth for the five years previous of 1.3%. This was driven by increased economic activity in the construction sector, which grew by 6.4% in 2018, and in the accommodation and food services industry, which grew by 4%.

Labour market conditions are also improving, with unemployment falling to 7% in 2018 – its lowest rate since 2002, and well below the average unemployment rate for the five years previous of 12.7%. Rising labour force participation has been necessary to offset a decline in the working-age population. The participation rate rose to 76.5% in 2018, the highest rate since 2011, while the working-age population fell to 6.6 million in 2018 – 0.5% less than in 2017, and the lowest level in nearly 30 years.