Portugal Adhering to Wage Trends
**Headline:** Wage and Labour Cost Trends in the EU and Eurozone: A Breakdown of Recent Developments
In the first half of 2025, the European Union (EU) and the Eurozone have witnessed significant wage growth, with nominal wages increasing by approximately 5.6–5.7% in Q2 2022 and continuing strong increases of around 5.7% (EU) and 5.2% (Eurozone) in Q3 2023 compared to the previous year. However, the rise in inflation has outpaced wage growth, resulting in a decline in real wages.
Hourly labour costs have also risen, increasing by 3.4% in the Eurozone and 4.1% in the EU during the first quarter of 2025. Eastern European countries, such as Croatia, Poland, Romania, Bulgaria, and others, have seen some of the highest hourly wage cost increases.
While specific data for Portugal, France, and Malta were not provided, it is expected that their wage growth trends align closer to the Eurozone averages rather than the high-growth trends seen in Eastern Europe. For Poland, outside the Eurozone, wage growth was notably high at 13.7% in 2024 but is forecasted to slow to about 5.3% by 2027.
Non-wage labour costs have also risen moderately, contributing to overall labour cost inflation. In the first quarter of 2025, Portugal and Italy recorded non-wage cost increases of around 4% and 1.9%, respectively, which aligns with the European average. Eastern European countries experienced the most significant increases in non-wage costs.
The services sector in the EU grew by 4.7%, with the construction sector seeing growth of 4.7% in the Eurozone and 5.2% in the EU. The market overall grew by 4.4% in the EU, with electricity and gas supply costs varying by 1.1%. In the construction sector, non-wage costs increased by 5.5%, and real estate saw a wage increase of 6.1%. Malta had a non-wage cost increase of 1.6%.
In conclusion, recent wage increases have been strong across the EU, especially in Eastern European countries, driving up hourly labour costs. The Eurozone and EU averages show moderate wage and total labour cost growth, with real wages still challenged by inflation. Specific data for Portugal, France, and Malta are not detailed but are expected to align closer to the Eurozone averages rather than the high-growth Eastern European trends. Non-wage labour costs also continue to rise moderately, contributing to overall labour cost inflation.
- The real estate sector in the EU, specifically in Portugal, experienced a wage increase of 6.1% in the first quarter of 2025, as part of the overall growth in the construction sector.
- The business and finance sectors, including the real estate industry, are keeping a keen eye on the wage and labor cost trends in Portugal, as these developments could potentially impact investment and growth prospects in the country.
- As the real estate industry in Portugal continues to grow with rising wages, it is crucial to remember that the growth in inflation has outpaced wage growth across the EU, posing challenges for both businesses and individuals in the real estate and finance industries.
