Comparing Austria, Germany, Greece, Portugal and the UK
Edited by Eleni Apospori and Jane Millar
Chapter 6: The dynamics of income poverty and social exclusion in Portugal
6. The dynamics of income poverty and social exclusion in Portugal Alfredo Bruto da Costa, Ana Cardoso, Isabel Baptista and Pedro Perista INTRODUCTION Poverty has been a persistent phenomenon in Portuguese society, presenting strong structural characteristics. Although unemployment is relatively low, the Portuguese poverty rate is the highest in the EU, in part because the poverty rate among employed people is much higher than the EU average. This highlights the fact that in Portugal exclusion from the labour market must not be seen as the major factor in explaining poverty. Other factors are vital in order to understand this phenomenon. The ﬁrst factor relates to a strong persistence of the informal economy that reduces unemployment but contributes to an increased vulnerability to poverty both during the active life of the individuals and also in their transition into retirement. A second factor is the precariousness of employment. The labour market is characterized by a diminishing number of permanent contracts and the simultaneous rise in short-term contracts; by an increase of the number of workers whose working hours are much above or below the normal number of working hours; and by the existence of a very wide range of salaries. Thirdly, there is a high degree of inequality in income distribution: in 1995, 20 per cent of the poorest households received only 6 per cent of the total income, whereas 20 per cent of the richest households received around 44 per cent (Barreiros, 2000). Apart from these labour market characteristics, poverty in...
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