The study, which represents the first chapter of the publication 'Economy and companies: trends, perspectives and proposals', an edition of the institution's new Office of Economic, Business and Public Policy Studies (G3E2P), analysed the evolution of the standard of living in Portugal.

“The relative loss [of living standards] between 1999 and 2022 resulted from the worse relative behaviour of productivity per employee and the unemployment rate and, to a lesser extent, the reduction of the relative advantage in the population's activity rate”, highlighted the FEP.

The FEP also warned that the predictable upward revision of the population in Eurostat data (incorporating more recent information from INE) will further worsen the relative standard of living, placing Portugal below Romania, in the 6th worst position in 2022 (75 .9% of the EU), instead of the 7th worst in official data (77.1%).

The institution also highlighted that “the signs of reversal of Portugal's temporary relative advantages since the start of the war in Ukraine, in terms of tourism (due to the image of a beautiful and safe destination, far from the conflict) and energy, are clear, so they will also tend to worsen the relative standard of living in the near future.

The FEP study also points to “a strong overestimation of the drop in the number of official hours per employee between 2019 and 2022 in Portugal in view of the effective evolution of the working day, resulting in an increase in hourly productivity well above that recorded in the EU”, citing other works on teleworking that point “to an increase in hours worked as a result of productivity losses, especially full-time, although there are advantages, such as reconciling family life”.

“The trend towards reducing hours worked is secular and will increase with technological advances, but this should be a decision of companies and workers, not an administrative one”. The study also shows that “the weight of wealth-generating factors in GDP has shrunk in favour of taxes and contributions, unlike the EU, also helping to explain our lower economic growth, as it is necessary to first generate wealth before sharing it”, according to the FEP.

The institution assured that “the share for the State has been increasingly larger, explaining the maximum tax burden of 36.4% of GDP in 2022 which, after relativizing the relative standard of living, translates into a tax effort 17% above the EU average, the 5th highest”.