In Portugal, youth employment is more volatile and more vulnerable to situations of economic instability than in most countries of the Organization for Economic Cooperation and Development (OECD) and in the European Union. The study “Young people in the labor market in Portugal (2007-2019)”, to be released this afternoon of Monday, October 18, at ISCTE-IUL, in Lisbon, as part of the launch of the Youth Employment Observatory, revelation that Portuguese young people not only have jobs that are more unstable than the population as a whole, but also lower median wages.
“On average, in the European Union, close to half of workers under the age of 25 have a fixed-term contract (48.9% on average in the years under review); in Portugal, this figure is around 60%, having been close to 70% in 2015 ”, concludes the study. Data show that there has been an increase since 2008, which is more pronounced in Portugal than in the EU, with growth in 2015 of 12.9 percentage points against 4.5 pp in the EU. “From that point on, the proportion of young people with fixed-term contracts tends to decrease, but this recovery is visibly more modest, not returning, in the period analyzed, to pre-crisis values”, the study says.
According to the study, “the main reason why workers find themselves in these types of contracts in Portugal is precisely the impossibility of finding permanent work, regardless of age group”.
The data reveal that young adults between 25 and 34 years old tend to be more associated with temporary employment than young people between 15 and 24 years old. Specifically, more than 80% of young adults were hired on a fixed term basis in the period under review (2007 to 2019). In the years of crisis, the number soared, reaching in 2013 a maximum value of 88.5%. For young people aged between 15 and 24 years, this is going through lower values, increasing from 72.5% in 2007 to a maximum of 77.1% in 2011, remaining in 2019 at 66% 6. Does this mean that two thirds of young people up to 24 years of age have a temporary job.
On average, in the European Union, a percentage of involuntary fixed-term contracts is lower. According to the study, for workers aged 25 to 32 years, the impossibility of finding permanent work justifies about 60% of fixed term contracts, but it becomes less recurrent in the economic recovery phase, decreasing to 55.5% in 2019. Also according to the study, only about 30% of young people under the age of 25 with fixed-term contracts stand out in this position. In this age group, the largest share of fixed-term contracts is due to the fact that young people are still in education or training (about 36%), which is not a preponderant reason in Portugal (about 12%).
Available jobs not corresponding to the qualification of young people
It is entitled “Why is the percentage of over-contracted workers so high in Portugal?” and it is the second of two studies that mark the launch of the Youth Employment Observatory. Here, the researchers focused on the period between 2000 and 2016, when the countries of the European Union invested heavily in qualifications with the aim of modernizing as national economies, which costs the expansion of higher education and the consequent increase in the supply of graduates.
“In Portugal, as in other Southern European countries, the generalized qualification of the labor force resulted in a discrepancy between the qualification of the worker and the qualification of the job, which is called over-qualification. This discrepancy is associated with a variety of factors, including a weak capacity of the productive fabric to absorb available qualified labor”, point out Paulo Marques, Fátima Suleman and Rita Guimarães.
The researchers also conclude that in Portugal, the over-qualification is due “in large part to the reduced weight of high-tech industries and services in the country’s economy and also to the weak contracting capacity of the public sector imposed by the austerity resulting from the weak growth of the economy in recent years”.
In the launch of the Youth Employment Observatory, a research unit of Dinâmia’CET – ISCTE, participates in the Dean of ISCTE-IUL, Maria de Lurdes Rodrigues, and the Deputy Secretary of State for Labor and Vocational Training, Miguel Cabrita. The Observatory aims to create a repository of content and research dedicated exclusively to the youth labor market and is funded by the Foundation for Science and Technology.