Lisbon, May 20, 2025 (Lusa) - According to the General State Accounts (cge), unemployment benefit expenditures increased by €234.5 million in 2024, reflecting "some deterioration" in the labour market, which is invisible in unemployment statistics.
According to the 2024 CGE, recently published by the Directorate-General for the Budget (DGO), expenditure on unemployment benefits totalled €1.59 billion in 2024, representing an increase of 17.3% compared to the previous year.
According to the CGE report, the increase is mainly explained by the €170.1 million (+16%) increase in expenditure on unemployment benefits, €52.1 million in wage guarantees, and €11.3 million in wage compensation for temporary suspension of employment contracts (traditional layoffs).
"The increase in expenditure reflects, on the one hand, some deterioration in the labour market, which, although not visible in Statistics Portugal's data on the unemployed population aged between 16 and 74, is evident in the 20.2% reduction in job offers and the 5.8% increase in unemployment registered with the Institute of Employment and Professional Training seeking new employment," the document states.
Added to this is the rise in the percentage of unemployed people receiving unemployment benefits - which was 52% in 2024, compared to 49.6% in 2023 - which led to a 16% increase in their number, as well as a 4.5% rise in the average benefit payment, reflecting the increase in earnings per worker and, in particular, the minimum wage, according to the CGE, which concludes that "the combined effect of the growth in the number of beneficiaries and benefits has led to a 16% increase in unemployment benefit expenditure".
Specific unemployment benefits granted for wage arrears also rose in 2024, increasing by 24.9% year-on-year. Despite this increase, the expenditure impact was negligible (€1.7 million).
Expenditure on social unemployment benefits fell by 2.07%, resulting from a 10.1% reduction in the number of beneficiaries of the subsequent tranche, helping to mitigate the overall increase in total expenditure on unemployment benefits in 2024.
According to the CGE, expenditures on wage guarantees to pay debts owed to employees by employers who are insolvent or in financial difficulty almost doubled, while layoffs affected 36.4% more workers in 2024 than in 2023.
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