Companies foresee salaries uptick of 4.2%

Portuguese companies are expecting salaries to go up by around 4.2%. That is still below the inflation rate but could be necessary to partly offset a continuing loss in purchasing power.

Over the coming months employees are expected to agree to upping salaries by at least 4% according to the study ‘Total Remuneration 2023’ by Mercer that nevertheless admits it may not be enough to counter a loss in consumer purchasing power.
“Organisations expect a positive evolution in the sphere of salary remunerations with salary increases foreseen for 2023/2024 averaging out at 4.2%”, states the human resources company adding that this increase will be more than last year but less than inflation.
“Although this is an increase, the salary increases foreseen will be below projected inflation making it difficult to recover the purchasing power lost by employees. From what we have been able to discern, organisations will be keeping an eye on inflation, but this scenario (of inflation) will continue to be a challenge for companies and their employees in Portugal”, says Marta Dias, rewards leader of Mercer Portugal.
Even so, there are companies planning to freeze wages in 2024 across the board: 7% of employees state this to be the case, although they won’t do so in 2023.