Social and Economic Equality – An introduction to the situation in

Portugal

PROJECT SEXUAL AND MORAL HARASSMENT IN THE WORKPLACE

STUDY TOUR TO NORWAY | OSLO, 1-3 OCTOBER 2014

To portrait social and economic equality in Portugal we must assess four main dimensions:

Portugal on the move | Structural conditions and changes

• Key figures

• Poverty and the importance of welfare and social transfers

• Walfare state – late development and lack of resources

• Education – contrasting generation and a fast move

• Family – relevant changes

Objective living conditions | Economic losses heighten social risks

• Employment

• Unemployment

• Income

Portugal on the move | Structural conditions

Structural conditions and change War and welfare

During the golden era of economic and welfare expansion in Europe, Portuguese colonial war (1961-1974) dominated the political, economical and social landscape of the country.

After the 1974 revolution

Under democracy and Europeanization an expanding social protection system gradually took form and became institutionalised - specially from 1995 on.

Late development welfare state’ s consequences: • the needs and expectations boosted by democracy pushed for the expansion

of social rights and higher levels of social protection.

• “late and compressed” modernization has been especially “difficult”: from welfare expansion to an era of market-oriented ideological dominance with low economic growth and budgetary pressures began.

• The global crisis of 2008-on has only reinforced these trends with “permanent austerity”.

• Present Key Figures

Portugal key figures

p Eurostat provisional value. e Estimated. 1 Gross domestic product (GDP) is a measure of economic activity. It is defined as the value of all goods and services produced less the value of any goods or services used in their creation. The volume index of GDP per capita in Purchasing Power Standards (PPS) is expressed in relation to the European Union (EU-27) average set to equal 100. If the index of a country is higher than 100, this country's level of GDP per head is higher than the EU average and vice versa. 2 Expenditure on social protection contains: benefits, which consist of transfers, in cash or in kind to households and individuals to relieve them of the burden of a defined set of risks or needs. 3 Unemployment rates represent unemployed persons as a percentage of the labour force. Unemployed persons comprise persons aged 15 to 74 who were: (a) without work during the reference week; (b) currently available for work; (c) actively seeking work. 4 Situation of penal institutions on 1 September, 2012. 5 Share of persons aged 0+ with an equivalent disposable income below the at-risk-of-poverty threshold, which is set at 60 % of the national median equivalised disposable income (after social transfers).

Year Portugal EU (28 countries)

Population  2013 10 487 289  505 665 739 

15–2410.7 %  11.5 % 

25–49 35.4 %  35.0 % 

50–64 19.8 % p 19.7 % 

 2012 76 100

 2011 26.5 % p 29.0 % p

 2013 16.5 % 10.8 %

 2013 37.7 % 23.4 %

 2012 17.9 % 17.0 % eAt risk of poverty rate 5

GDP per capita in PPS (Purchasing

Power Standards) 1

Total expenditure on social

protection (% of GDP) 2

Unemployment rate 3

Unemployment rate of population

aged under 25 years

Population by age

classes

 2013

Poverty

Portugal has one of the highest child poverty rate: 17%. OECD countries average is about 12% 8 (Source: OECD

report "Doing better for families”)

But data from other sources, namely the EU SILK, reveals that children under deprivation in Portugal may attain 27,4% , as we can see in the next slide.

Child poverty affects mostly children living in female single parent families.

CHILD POVERTY

UNICEF - Innocenti Research Centre, Report Card 10

Poverty risk in Portugal and the importance of social transfers

Source: INE

Evolution of Social Security Expenditure in % GDP (1960-2012)

France

Denmark

Belgium

Finland

Sweden

Italy

Austria

Spain

Germany

Portugal

Netherlands

Slovenia

United Kingdom

Luxembourg

Greece

Norway

Japan

New Zealand

Ireland

OECD

Hungary

Czech Republic

Poland

United States

Australia

Switzerland

Canada

Slovak Republic

Estonia

Iceland

Israel

Turkey

Chile

Korea

Mexico

Russian Federation (2009)

Brazil (2010)

China (2012)

South Africa (2007)

India (2006/07)

Indonesia (2009)

Public social expenditure in percentage of GDP, 2012-13 Percentage point change

32,8

30,8

30,6

30,3

28,4

28,2

28,1

27,1

26,0

25,7

24,2

23,8

23,7

23,3

23,1

22,6

22,3

22,2

22,0

21,9

21,6

21,4

20,8

19,8

19,2

18,9

18,3

18,1

17,7

17,4

15,8

12,8

10,2

9,3

7,4

15,7

14,4

9,0

8,1

4,6

2,1

05101520253035

2,5

3,8

2,9

4,6

1,6

2,4

2,4

4,3

2,2

2,6

2,2

3,3

2,9

2,7

2,0

2,8

2,9

2,3

5,2

2,5

0,4

2,5

1,7

2,9

0,5

2,1

1,7

3,2

5,8

2,7

0,4

2,2

1,5

1,4

1,0

0,5

0,4

1,1

0,7

-0,6

0,3

-0,8

0,7

-1,3

0,2

0,9

0,8

-0,1

-0,6

-0,8

-0,3

0,0

0,6

-1,6

-0,2

-1,9

0,7

-0,9

0,3

1,5

-0,9

-0,9

-0,8

-2,4

-0,8

-0,2

0,0

-0,9

-0,1

-0,7

-2 -1 0 1 2 3 4 5 6

Between 2007-08 and 2009-10 Between 2009-10 and 2012-13

In short

• Social transfers are essential to decrease poverty;

• Social expenditure increased tremendously after 2009, and especially after 2011 when the country was “rescued”;

• In spite of the cuts on benefits, on public sector salaries and pensions, costs with unemployment benefits and on interest rates did not have the effect of decreasing the public debt.

• Austerity is not having the foreseen positive results.

Education| contrasting generations and a fast move

Years of completed education

By country and sex

Source: European Social Survey (ESS) 2012

By country and age

Years of completed education

Source: European Social Survey (ESS) 2012

By country, age and sex: 15-29

By country, age and sex: 30 - 59 By country, age and sex: + 60

Source: European Social Survey (ESS) 2012

Years of completed education

Contrasting generations: • The number of years completed

education have significantly improved (about 6 years).

• Strongly contrasting with the older generation, women (15-29) are more qualified than men: more years of completed education.

Education| contrasting generations and a fast move

• Portugal has the lower level of education among European countries (years of completed education).

• But it shows also an outstanding improvement of level of education between generations. It is the European country where the growth is the highest, showing that public money invested in education was well spent:

– 6 years of difference between the oldest and the youngest while the average in other countries is 2 or 3 years.

– Youth (15-29) have about 12 years of completed education (almost like the average in Europe).

Family | relevant changes

A younger generation and the effects of education, democratization and Europeanization (cosmopolitanism):

• More educated.

• Brought up in a more open and non-traditional

environment, following the 1974 democratic revolution and the Europeanization process.

• A different approach to marriage, cohabitating or having children.

Catholic marriage in Portugal (1960-2010) (%)

Children born out of the wedlock Portugal (1960-2010) (%)

Marriage* and Divorce Rate* *in Portugal (1960-2010) %o

Source: Estatisticas Demograficas, INE, 1960-2010

Source: Estatisticas Demograficas, INE, 1960-2010 Source: Estatisticas Demograficas, INE, 1960-2010 *Crude Divorce rate: Number of divorces /average population **Crude Marriage rate: Number of marriages/average population

Objective living conditions | Economic losses heighten social risks

• Besides the structural features identified, the Recession

continues (in Portugal and in other European countries) to cast a particularly long shadow on workers and their families:

• In the worst-affected countries (eg: Portugal), labour income – households’ most important income source – keeps on falling.

• In the majority of the countries, the recovery has not yet translated into significant improvements in labour market conditions: employment continues to fall and unemployment have risen.

Employment| Portugal in the European context

European trend to employment fall. Employment fall in Portugal and gender differences (2007-2012):

• Men = -10 percentage points • Women = -3,9 percentage points

Iceland

Switzerland

Norway

Netherlands

Sweden

Germany

Denmark

New Zealand

Canada

Austria

Australia

Japan

United Kingdom

Finland

Estonia

Czech Republic

United States

Israel

OECD

Luxembourg

Korea

France

Slovenia

Chile

Belgium

Portugal

Mexico

Slovak Republic

Ireland

Poland

Hungary

Italy

Spain

Turkey

Greece

Russian Federation

South Africa

Employment rate, aged 15-64, total and by gender, Q2 2013 (%) Percentage point change in employment rate between 2007 and Q2 2013

80,8

79,4

75,3

74,4

74,2

73,3

72,8

72,8

72,6

72,4

72,2

71,5

70,5

69,2

69,0

67,8

67,3

66,7

66,2

65,7

64,2

64,0

62,9

62,3

61,9

60,5

60,4

60,0

59,9

59,8

58,2

55,5

54,3

49,7

49,2

69,0

41,2

0102030405060708090

0102030405060708090

Total (↘) Women Men

- 20 - 15 - 10 - 5 0 5 10

-20 -15 -10 -5 0 5 10

Total Women Men

Unemployment| the economic crisis has had a strong impact on unemployment rates

• Greece and Spain were hit particularly hard: an increase of above 18 percentage points.

• Increases of more than 5 percentage points in: Ireland, Italy, Portugal and Slovenia. Portugal has de third higher unemployment rate just after Greece and Spain.

• In Portugal, unemployment equally affects women and men. Looking at the variation of unemployment rate 2007-2012 in Portugal, unemployment increased more among men than among women (due mainly to the loss of jobs in construction and building sector).

Greece

Spain

Portugal

Slovak Republic

Ireland

Italy

Slovenia

Poland

Hungary

France

OECD

Turkey

Estonia

Belgium

Sweden

Finland

United Kingdom

United States

Canada

Denmark

Czech Republic

Israel

Netherlands

New Zealand

Luxembourg

Chile

Australia

Iceland

Germany

Mexico

Austria

Switzerland

Japan

Norway

Korea

South Africa

Russian Federation

Unemployment in percentage of labour force, aged 15-64, Total and by

gender, Q2 2013 (%) Percentage point change in unemployment rate between 2007 and Q2 2013

27,9

26,5

17,7

14,1

14,0

12,3

10,9

10,7

10,5

10,2

9,1

8,9

8,6

8,6

8,3

8,1

7,9

7,6

7,2

7,0

7,0

6,7

6,7

6,4

6,3

6,2

5,8

5,6

5,4

5,2

4,7

4,3

4,3

3,4

3,3

25,4

5,5

051015202530

051015202530

Total (↘) Women Men

- 4 - 2 0 2 4 6 8 10 12 14 16 18 20

-4 -2 0 2 4 6 8 10 12 14 16 18 20

Total Women Men

0

2

4

6

8

10

12

14

16

181

99

8

19

99

20

00

20

01

20

02

20

03

20

04

20

05

20

06

20

07

20

08

20

09

20

10

20

11

20

12

20

13

%

Men

Women

Unemployment rate: Portugal (by sex)

Source: INE

Unemployment| hiting youth hard and long term unemployed

• Youth have been hit particularly hard by the

deteriorated labour market situation.

• The unemployment rate for young people aged 15-24 increased by 20 percentage points or more from mid-2007 to mid-2013 in Greece, Portugal and Spain.

• Long term unemployment also affects hardly less qualified older workers (45/64).

-6

-1

5

10

15

20

25

30

35

40

Young people (15-24) (↗) Older people (55-64)

Percentage point change in unemployment rates between 2007 and Q2 2013

The share of youth not in employment, education or training (“NEETs”) has gone up significantly (2012):

• The sharpest increases were recorded in countries hardest hit by the crisis (Estonia, Greece, Ireland, Portugal, and Spain).

Why are these data of great concern?

• Participation in employment, education or training is important for youth transition to the labour market and to achieve self-sufficiency.

Greece

Turkey

Italy

Mexico

Spain

Slovak Republic

Ireland

Portugal

Hungary

United States

Belgium

New Zealand

United Kingdom

France

OECD

Poland

Australia

Estonia

Luxembourg

Slovenia

Canada

Czech Republic

Finland

Germany

Sweden

Japan

Norway

Austria

Switzerland

Iceland

Denmark

Netherlands

South Africa

India

Saudi Arabia

Argentina

Brazil

China

NEET rates, 15/16-24 year-olds, Q4 2012 (%) Percentage point change between Q4 2007 and Q4 2012

14,7

4,5

9,8

3,6

13,2

10,8

9,2

10,4

7,3

5,7

6,4

5,7

7,1

8,9

5,9

6,9

5,0

4,2

4,5

6,3

4,5

5,7

3,5

3,0

3,7

2,7

2,2

3,1

2,5

3,6

1,9

1,7

12,6

22,2

11,5

17,5

6,4

7,7

7,5

4,9

7,8

9,3

7,5

8,0

6,4

4,4

6,7

5,4

7,1

7,0

5,9

3,7

5,1

3,4

4,9

4,6

3,5

4,2

4,5

3,1

3,5

2,3

3,9

2,8

05101520253035

Unemployed Inactive

-15 -10 -5 0 5 10

Unemployed Inactive

31,6

25,4

15,3

14,4

12,5

6,6

3,5

5,3

4,6

4,2

3,7

Income | families' financial situation

• The most commonly used statistics of labour-market difficulties refer to individuals rather than to households.

• Since 2007 the proportion of people living in households with no income from work has gone up: increasing by 20% or more in Portugal.

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5

10

15

20

Lu

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Germ

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Ne

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Austr

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Czech R

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Esto

nia

Slo

vak R

epub

lic

Port

ug

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Fin

land

Un

ite

d S

tate

s

La

tvia

De

nm

ark

Slo

ven

ia

Un

ite

d K

ing

dom

Pola

nd

Ita

ly

Turk

ey

Fra

nce

Hu

nga

ry

Belg

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Spain

Irela

nd

Gre

ece

2012 (↗) 2007

Shares of adults living in workless households, in percentages

Rescued countries

• In Portugal, Ireland and Cyprus people frequently recognize difficulties in living with their income.

• Between 2008 and 2012 the difficulties are intensifying almost everywhere, but the bigger gaps are in Ireland (+11%), Spain (+9%) and some post-communist.

Source: European Social Survey (ESS) 2008 and 2012

People declaring that they find difficult or very difficult to live with their present income

Income | gender inequalities

In Portugal average income inequality between men and women increases with level of education: • The Higher the level of education = the higher

gender income inequality.

• Strong glass celling effects.

• Wage gap between men and women in Portugal was 16,5% in 2012 while in the EU-27 was 15,7% and it has increased since 2007.

Source: Quadros de pessoal 2006 GEP/MTSS

Average income by level of education and sex (2006)

Final remarks|

• Structural fragilities of our economy, high social inequalities, a late development of political democracy and of the welfare state still mark our society.

• Portuguese welfare conception is modern however there is a chronicle lack of resources to fund policies – effects also of a long period wasting resources in colonial war (1961-1974).

• Portuguese welfare lack of resources - permanent austherity – increased by the current financial and economic situation:

• Social spending increased least in Portugal one of the most affected countries by the crisis.

• A generation born in the 70s and 80s, considerably more educated than their parents are main agents of transformation regarding family, gender and equality issues defying established common sense about Portugal as a catholic southern country.

• But some of the youngest and more educated are living the country because they do not have job opportunities (the taxes we paid for their education are then “wasted” and profited by other countries).

• The mix between a quite immature welfare state, the current crisis and public cuts lead to worsen living conditions: • Employment fall + unemployment increase

• Unemployment hitting hard on youth and on less qualified older workers;

• Deterioration of families' financial situation

• Dissatisfaction with living conditions