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Portugal has made significant progress over the last few years in modernising its economy and improving the living standards of its citizens, however the global financial crisis has surely weakened its growth. Portugal performs only moderately well in overall measures of well-being, as it ranks lower or close to the average in a large number of topics in the Better Life Index.
Money, while it cannot buy happiness, is an important means to achieving higher living standards. In Portugal, the average household net-adjusted disposable income is 19 366 USD a year, less than the OECD average of 23 047 USD a year. But there is a considerable gap between the richest and poorest – the top 20% of the population earn six times as much as the bottom 20%.
In terms of employment, around 64% of people aged 15 to 64 in Portugal have a paid job, close to the OECD employment average of 66%. Some 68% of men are in paid work, compared with 60% of women. People in Portugal work 1 711 hours a year, slightly less than the OECD average of 1 776 hours. Around 9% of employees work very long hours, in line with the OECD average, with 12% of men working very long hours compared with just 5% for women.
Having a good education is an important requisite for finding a job. In Portugal, 32% of adults aged 25-64 have earned the equivalent of a high-school degree, much lower than the OECD average of 74% and the lowest rate amongst OECD countries. This is truer of women than men, as 29% of men have successfully completed high-school compared with 35% of women. In terms of the quality of the educational system, the average student scored 490 in reading literacy, maths and science in the OECD’s Programme for International Student Assessment (PISA). This score is slightly lower than the OECD average of 497. On average in Portugal, girls outperformed boys by 10 points, slightly more than the average OECD gap of 9 points.
In terms of health, life expectancy at birth in Portugal is almost 81 years, one year above the OECD average. Life expectancy for women is 84 years, compared with 78 for men. The level of atmospheric PM10 – tiny air pollutant particles small enough to enter and cause damage to the lungs – is 20 micrograms per cubic meter, close to the OECD average of 21 micrograms per cubic meter. Portugal does well in terms of water quality, as 86% of people say they are satisfied with the quality of their water, slightly more than the average OECD level of 84%.
Concerning the public sphere, there is a moderate sense of community and level of civic participation in Portugal, where 85% of people believe that they know someone they could rely on in time of need, less than the OECD average of 90%. Voter turnout, a measure of public trust in government and of citizens’ participation in the political process, was 58% during recent elections, lower than the 72% OECD average. Social and economic status can affect voting rates; voter turnout for the top 20% of the population is 63% and for the bottom 20% it is 56%. This 7 percentage point difference is lower than the OECD average difference of 12 percentage points and suggests there is broad social inclusion in Portugal’s democratic institutions.
In general, 71% of people in Portugal say they have more positive experiences in an average day (feelings of rest, pride in accomplishment, enjoyment, etc) than negative ones (pain, worry, sadness, boredom, etc), below the OECD average of 80%.
OECD in Action
Portugal: Reforming the State to promote growth
Despite the hardships brought about by the crisis, Portugal is now faced with a unique opportunity to modernise its economy, as well as building a fairer, more cohesive society and a more efficient, dynamic public administration. Drawing on the experience of OECD member countries, the analysis and advice reported in this document aim to provide Portuguese policy makers not only with a compass but also with a policy map of a brighter future.Read this report
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Portugal in Detail
Housing – Portugal expand
Living in satisfactory housing conditions is one of the most important aspects of people’s lives. Housing is essential to meet basic needs, such as shelter, but it is not just a question of four walls and a roof. Housing should offer a place to sleep and rest where people feel safe and have privacy and personal space; somewhere they can raise a family. All of these elements help make a house a home. And of course there is the question whether people can afford adequate housing.
Housing costs take up a large share of the household budget and represent the largest single expenditure for many individuals and families, by the time you add up elements such as rent, gas, electricity, water, furniture or repairs. In Portugal, households on average spend 17% of their gross adjusted disposable income on keeping a roof over their heads, well below the OECD average of 21%.
In addition to housing costs it is also important to examine living conditions, such as the average number of rooms shared per person and whether households have access to basic facilities. In Portugal, 92% of people say they are satisfied with their current housing situation, more than the OECD average of 87%. This level of subjective satisfaction reflects Portugal’s good performance in objective housing indicators.
The number of rooms in a dwelling, divided by the number of persons living there, indicates whether residents are living in crowded conditions. Overcrowded housing may have a negative impact on physical and mental health, relations with others and children’s development. In addition, dense living conditions are often a sign of inadequate water and sewage supply. In Portugal, the average home contains 1.6 rooms per person, in line with the OECD average. In terms of basic facilities, 98.8%of people in Portugal live in dwellings with private access to an indoor flushing toilet, more than the OECD average of 97.8%.
More ResourcesHow's Life? at a Glance
Income – Portugal expand
While money may not buy happiness, it is an important means to achieving higher living standards and thus greater well-being. Higher economic wealth may also improve access to quality education, healthcare and housing.
Household net-adjusted disposable income is the amount of money that a household earns each year after tax. It represents the money available to a household for spending on goods or services. In Portugal, the average household net-adjusted disposable income is 19 366 USD a year, lower than the OECD average of 23 047 USD.
Household financial wealth is the total value of a household’s financial worth. In Portugal, the average household net financial wealth is estimated at 28 408 USD, lower than the OECD average of 40 516 USD. While the ideal measure of household wealth should include real assets (e.g. land and dwellings), such information is currently available for only a small number of OECD countries.
Despite a general increase in living standards across OECD countries over the past fifteen years, not all people have benefited from this to the same extent. In Portugal, the average net adjusted disposable income of the top 20% of the population is an estimated 40 277 USD a year, whereas the bottom 20% live on an estimated 7 079 USD a year.
More ResourcesHow's Life? at a Glance
Jobs – Portugal expand
Having a job brings many important benefits, including: providing a source of income, improving social inclusion, fulfilling one’s own aspirations, building self-esteem and developing skills and competencies. In Portugal, around 64% of the working-age population aged 15 to 64 has a paid job. This figure is close to the OECD average of 66%. Employment rates are generally higher for individuals with a higher level of education; in Portugal, an estimated 81% of individuals with at least a tertiary education have a paid job, compared with an estimated 61% for those without an upper secondary education. This 20 percentage point difference is lower than the OECD average of 37 percentage points and suggests the job market in Portugal is relatively inclusive.
Women are still less likely than men to participate in the labour market. In Portugal, 60% of women have jobs, a figure in line with the OECD average, but below the 68% employment rate of men in Portugal. This 8 percentage point gender difference is lower than the OECD average of 12 percentage points and suggests Portugal could further improve employment opportunities for women but has generally been successful in addressing the constraints and barriers women face in accessing work.
Young Portuguese people aged 15-24, however, are facing difficulties, with an unemployment rate of 30.1% compared with the OECD average of 16.2%.
Unemployed persons are defined as those who are not currently working but are willing to do so and actively searching for work. Long-term unemployment can have a large negative effect on feelings of well-being and self-worth and result in a loss of skills, further reducing employability. In Portugal, the percentage of the labour force that has been unemployed for a year or longer is currently at 6.1%, much higher than the OECD average of 3.1%. There is little difference on average between men and women in the OECD area when it comes to long-term unemployment. In Portugal, the unemployment rate for men is slightly lower than for women with respectively 6.0% and 6.3%.
The wages and other monetary benefits that come with employment are an important aspect of job quality. In Portugal, people earn 24 384 US dollars per year on average, less than the OECD average of 34 466 USD Not everyone earns that amount however. Whereas the top 20% of the population earn 30 578 USD per year, the bottom 20% live on 13 056 USD per year.
Another essential factor of employment quality is job security. Employees working on temporary contracts are more vulnerable than workers with an open-ended contract. In Portugal, close to 9% of total employees have a contract of 6 months or less, slightly lower than the average of 10% for 30 OECD countries. This figure suggests Portugal has been successful in stabilising working contracts and encouraging open-ended contracts.
More ResourcesWell‑being in the workplace: Measuring job quality
Community – Portugal expand
Humans are social creatures. The frequency of our contact with others and the quality of our personal relationships are thus crucial determinants of our well-being. Helping others can also make you happier. People who volunteer tend to be more satisfied with their lives than those who do not. Time spent volunteering also contributes to a healthy civil society. On average, people in Portugal spend 2 minutes per day in volunteering activities, less than the OECD average of 4 minutes per day. Nearly 45% reported having helped a stranger in the last month, slightly less than the OECD average of 48%.
A strong social network, or community, can provide emotional support during both good and bad times as well as provide access to jobs, services and other material opportunities. In Portugal, 85% of people believe that they know someone they could rely on in time of need, less than the OECD average of 90%. There is a 2 percentage point difference between men and women, as 86% of men believe they have this kind of social support, compared with 84% of women. While gender has little impact on social network support, there is a relationship between the availability of social support on the one hand, and people’s education level, on the other. In Portugal, only 75% of people who have completed primary education report having someone to count on for help in times of need, compared to 95% for people who attained tertiary education.
A weak social network can result in limited economic opportunities, a lack of contact with others, and eventually, feelings of isolation. Socially isolated individuals face difficulties integrating into society as a contributing member and fulfilling personal aspirations.
More ResourcesHow's Life? at a Glance OECD Insights: Human Capital
Education – Portugal expand
A well-educated and well-trained population is essential for a country’s social and economic well-being. Education plays a key role in providing individuals with the knowledge, skills and competences needed to participate effectively in society and in the economy. Most concretely, having a good education greatly improves the likelihood of finding a job and earning enough money. Across OECD countries, 83% of people with university-level degrees have a job, compared with just below 56% for those with only a secondary school diploma. Lifetime earnings also increase with each level of education.
Following a decline in manual labour over previous decades, employers now favour a more educated labour force. High-school graduation rates therefore provide a good indication of whether a country is preparing its students to meet the minimum requirements of the job market. In Portugal, 32% of adults aged 25-64 have earned the equivalent of a high-school degree, much lower than the OECD average of 74% and one of the lowest rates amongst OECD countries. Across the OECD, slightly more men aged 25-64 have the equivalent of a high-school degree compared with women from the same age group.In Portugal however, the opposite is true as 29% of men have successfully completed high-school compared with 35% of women. Among younger people – a better indicator of Portugal’s future – 52% of 25-34 year-olds have earned the equivalent of a high-school degree, still lower than the OECD average of 82% but showing progress.
The Portuguese can expect to go through 18.0 years of education between the ages of 5 and 39, more than the OECD average of 16.5 years. This high level of education expectancy could influence Portugal’s future performance in the educational attainment of its 25-34 year-old population.
But graduation rates, while important, speak little to the quality of education received. The OECD’s Programme for International Student Assessment (PISA) reviews the extent to which students have acquired some of the knowledge and skills that are essential for full participation in modern societies. In 2009, PISA focused on examining students’ reading ability, skills in maths and level in sciences, as research shows that these skills are more reliable predictors of economic and social well-being than the number of years spent in school.
The average student in Portugal scored 490 in reading literacy, maths and sciences, lower than the OECD average of 497. On average, girls outperformed boys by 10 points, slightly more than the average OECD gap of 9 points.
The best-performing school systems manage to provide high-quality education to all students. In Portugal, the average difference in results, between the 20% with the highest socio-economic background and the 20% with the lowest socio-economic background is 105 points, higher than the OECD average of 99 points. This suggests the school system in Portugal tends to provide higher quality education for the better off.
Better Policies for Better Lives
Student learning outcomes in Portugal are around or slightly below the OECD average, depending on the skills assessed, and have shown some encouraging improvement in the last decade. However the high share of students leaving the education system too early with low skills remains a major problem. Portugal has introduced a number of measures to increase secondary and tertiary education attainment and improve quality in education. The Education Programme 2015, for instance, establishes targets for school education focusing on two main priority areas: improving the basic competencies of students, and ensuring that all young people remain in the education system. The programme sets targets for reducing the early school leaving rate for 14-16 year-olds, and reducing the number of students who repeat grades, with indicators to monitor progress. These targets are linked to wider European Union benchmarks for 2020.
There have also been a number of recent initiatives to use schools to provide a second opportunity to people who have left school early or are at risk of doing so, or adults who may not have completed compulsory education. Under the New Opportunities scheme these programmes are offered on school premises and using the school’s teachers.
More ResourcesHow's Life? at a Glance
Environment – Portugal expand
The quality of our local living environment has a direct impact on our health. Having access to green spaces for example, is essential for quality of life. An unspoiled environment is a source of satisfaction, improves mental well-being, allows people to recover from the stress of everyday life and to perform physical activity. In Portugal, 20% of people feel they lack access to green spaces or recreational areas, much more than the 12 % average of OECD European countries.
Outdoor air pollution is one important environmental issue that directly affects the quality of peoples’ lives. Despite national and international interventions and decreases in major pollutant emissions, the health impacts of urban air pollution continue to worsen, with air pollution set to become the top environmental cause of premature mortality globally by 2050. Air pollution in urban centres, often caused by transport and the use of small-scale burning of wood or coal, is linked to a range of health problems, from minor eye irritation to upper respiratory symptoms in the short-term and chronic respiratory diseases such as asthma, cardiovascular diseases and lung cancer in the long-term. Children and the elderly may be particularly vulnerable.
PM10 – tiny particulate matter small enough to be inhaled into the deepest part of the lung – is monitored in OECD countries because it can harm human health and reduce life expectancy. In Portugal, PM10 levels are 19.9 micrograms per cubic meter, below the OECD average of 20.9 micrograms per cubic meter and just at the level of the annual guideline limit of 20 micrograms per cubic meter set by the World Health Organization.
Access to clean water is fundamental to human well-being. Despite significant progress in OECD countries in reducing water pollution, improvements in freshwater quality are not always easy to discern. In Portugal, 86% of people say they are satisfied with water quality. This figure is slightly higher than the OECD average of 84% and suggests Portugal has generally been successful in providing good quality water to its inhabitants.
More ResourcesHow's Life? at a Glance OECD Environmental Outlook to 2030
Governance – Portugal expand
A cohesive society is one where citizens have a high degree of confidence in their governmental institutions and public administration. In Portugal, 43% of people say they trust their political institutions, less than the OECD average of 56%. High voter turnout is another measure of public trust in government and of citizens’ participation in the political process. In the most recent elections for which data is available, voter turnout in Portugal was 58% of those registered. This figure is lower than the OECD average of 72%.
Even if the right to vote is universal in all OECD countries, not everyone exercises this right. There is little difference in the voting rates of men and women in most OECD countries. This is the case in Portugal, where the voter turnout of men and women is nearly the same. While on average there are few differences between men and women concerning participation in elections, income can have a strong influence on voter turnout. In Portugal, voter turnout for the top 20% of the population is an estimated 63% whereas the participation rate of the bottom 20% is an estimated 56%. This 7 percentage point difference is lower than the OECD average difference of 12 percentage points and suggests there is broad social inclusion in Portugal’s democratic institutions.
Ensuring that government decision making is not compromised by conflicts of interest is key to maintaining trust in government. Transparency is therefore essential to hold government to account and to maintain confidence in public institutions.
Freedom of information laws (FOI) allow the possibility for individuals to access undisclosed information. For such policies to be successful, the public should have a clear understanding of their rights under the law, should be able to file requests with ease and should be protected against any possible retaliation. People in Portugal can file a request for information either in writing, online, or in person – thus greatly facilitating the FOI process. However, there are no provisions for anonymity or protection from retaliation.
More ResourcesHow's Life? at a Glance
Health – Portugal expand
Most OECD countries have enjoyed large gains in life expectancy over the past decades, thanks to improvements in living conditions, public health interventions and progress in medical care. Life expectancy at birth in Portugal stands at almost 81 years, one year above the OECD average of 80 years. Life expectancy for women is 84 years, compared with 78 for men, in line with the OECD average gender gap.
Higher life expectancy is generally associated with higher healthcare spending per person, although many other factors have an impact on life expectancy (such as living standards, lifestyles, education and environmental factors). Total health spending accounts for 10.7% of GDP in Portugal, more than the OECD average of 9.5%. However; Portugal ranks below the OECD average in terms of total health spending per person, at 2728 USD in 2010, compared with an OECD average of 3268 USD. Between 2000 and 2009, total health spending in Portugal increased in real terms by 2.3% per year on average, a slower rate than the OECD average of 4.7%. This growth rate then slowed to 0.6% in 2010.
Throughout the OECD, tobacco consumption and excessive weight gain remain important risk factors for many chronic diseases. Around 18.6% of adults in Portugal smoke daily, compared with an OECD average of 21.1%. In many OECD countries, large proportions of the population are overweight or obese. In Portugal, the obesity rate among adults – based on self-reported height and weight – is 15.4%, lower than the OECD average of 17.8%. Obesity’s growing prevalence foreshadows increases in the occurrence of health problems (such as diabetes, cardiovascular diseases and asthma), and higher health care costs in the future.
When asked, “How is your health in general?”, only 49% of people in Portugal reported to be in good health, much lower than the OECD average of 69%. Despite the subjective nature of this question, answers have been found to be a good predictor of people’s future health care use. Gender, age and social status may affect answers to this question. On average in OECD countries, men are more likely to report good health than women, with an average of 71% for men and 66% for women. In Portugal, the average is 55% for men and 44% for women. Not surprisingly, older people report poorer health, as do those who are unemployed, or who have less education or income. About 65% of the top 20% of the adult population in Portugal rated their health as ‘good’ or ‘very good’, compared to about 39% for the bottom 20%.
More ResourcesHow's Life? at a Glance
Life Satisfaction – Portugal expand
and feelings, and the absence of negative experiences and feelings. Such measures, while subjective, are a useful complement to objective data to compare the quality of life across countries.
Life satisfaction measures how people evaluate their life as a whole rather than their current feelings. It captures a reflective assessment of which life circumstances and conditions are important for subjective well-being. When asked to rate their general satisfaction with life on a scale from 0 to 10, Portuguese people gave it a 5.0 grade, lower than the OECD average of 6.6.
There is little difference in life satisfaction levels between men and women across OECD countries. This is true in Portugal, where men gave their life a 4.9 grade and women 5.1. Education levels, however, strongly influence subjective well-being. Whereas people who have only completed primary education in Portugal have a life satisfaction level of 4.1, this score reaches 6.5 for people with tertiary education.
Happiness, or subjective well-being, is also measured by the presence of positive experiences and feelings, and/or the absence of negative experiences and feelings. In Portugal 71% of people reported having more positive experiences in an average day (feelings of rest, pride in accomplishment, enjoyment, etc) than negative ones (pain, worry, sadness, boredom, etc). This figure is lower than the OECD average of 80%.
More ResourcesHow's Life? at a Glance
Safety – Portugal expand
Personal security is a core element for the well-being of individuals, and largely reflects the risks of people being physically assaulted or falling victim to other types of crime. Across the OECD, assault rates have generally declined in the past five years. In Portugal, 5.8% of people reported falling victim to assault over the previous 12 months, more than the OECD average of 4.0%. There is little difference between men and women in assault rates, at respectively 5.5% and 6.1%.
The homicide rate (the number of murders per 100,000 inhabitants) is a more reliable measure of a country’s safety level because, unlike other crimes, murders are usually always reported to the police. According to the latest OECD data, Portugal’s homicide rate is 1.2, lower than the OECD average of 2.2. In Portugal, the homicide rate for men is 1.7 compared with 0.7 for women.
Fear of crime is another important indicator as it can constrain behaviour, restrict freedom and threaten the foundation of communities. Despite a general reduction in assault rates in the past five years, in many OECD countries feelings of security have declined. In Portugal, 49% of people feel safe walking alone at night, lower than the OECD average of 67%. While men are at a greater risk of being victims of assaults and violent crimes, women report lower feelings of security than men. This has been explained by a greater fear of sexual attacks, the feeling they must also protect their children and their concern that they may be seen as partially responsible.
More ResourcesHow's Life? at a Glance
Work-Life Balance – Portugal expand
Finding a suitable balance between work and life is a challenge for all workers, especially working parents. Some couples would like to have (more) children, but do not see how they could afford to stop working. Other parents are happy with the number of children in their family, but would like to work more. This is a challenge to governments because if parents cannot achieve their desired work/life balance, not only is their welfare lowered but so is development in the country.
People spend one-tenth to one-fifth of their time on unpaid work. The distribution of tasks within the family is still influenced by gender roles: men are more likely to spend more hours in paid work, while women spend longer on unpaid domestic work. Men in Portugal, spend 96 minutes per day cooking, cleaning or caring, less than the OECD average of 131 minutes and less than a third as long as Portuguese women who spend 328 minutes per day on average on domestic work, one of the highest differences in the OECD.
Another important aspect of work-life balance is the amount of time a person spends at work. Evidence suggests that long work hours may impair personal health, jeopardize safety and increase stress. People in Portugal work 1 711 hours a year, less than the OECD average of 1 776 hours. The share of employees working more than 50 hours per week is not very large across OECD countries. In Portugal, almost 9% of employees work very long hours, in line with the OECD average. Overall, men spend more hours in paid work: in Portugal 12% of men work very long hours, compared with 5% for women.
Better Policies for Better Lives
Portuguese families need further childcare support
For over a generation of families, fertility rates in Portugal have been falling. Today, only one other OECD country has a lower fertility rate (Korea). Sustainable fertility is important to ensure aging populations don’t threaten Portugal’s welfare systems and future productivity.
In reality, the Portuguese problem is not that families have no children, but rather families not having more than one child. Childlessness is low in Portugal, less than one in ten women aged 49+ have no children, but around half of all Portuguese families are one-child families. To improve fertility rates, Portuguese families need more support when caring for young children.
Recent parental leave reform has helped both mothers and fathers to spend more time with their newborns, as well as promoting gender equity through financial incentives to share parental leave. Pre-school childcare enrolment in Portugal has tripled in the last decade, it now stands at around 65% (OECD average is 58.2%).
Portugal should try to invest more of their public family budget towards early support for children, even in times when budget pressures are at their highest. Investment on child services is essential to enable families to flourish, for future welfare state sustainability and for economic growth. Portugal is already spending less than the OECD average at each stage of childhood. Reported spending on children in their early years is less than half of the OECD average (EUR 11 500 per child compared to EUR 24 900) and mid- and late- childhood spending lag behind OECD levels by around one-third and one-quarter respectively.