Earnings: studying no longer pays off.

In some cases, it is becoming less and less worthwhile. I will explain my reasoning that corroborates the previous statement. Let's look at the numbers, which don't lie. In 2015, the minimum wage in Portugal was 55% of the average wage. In 2024, it already represented 68%. It rose 13 percentage points in less than a decade. Portugal became the country in the Eurozone where the minimum wage is closest to the median wage.

At first glance, it seems positive. After all, we're raising the lowest wage, right? The problem is that we're doing it alone. The average wage hasn't kept pace. And this isn't a technical detail – it's a very serious problem that is destroying the Portuguese middle class.

The government has already announced: the minimum wage will rise to 920 euros in 2026 and 1,100 euros in 2029. Great. Nobody disputes that. But I ask: what then? What about those who earn 1,200? What about those who earn 1,500? What about those who studied, qualified, and have years of experience? Will they be left high and dry while the minimum wage erodes their standing month after month?

Since 2015, the minimum wage has risen by 315 euros – a growth of 62%. The average wage? It only rose by 298 euros, from 916 to 1,214 euros. Growth rate: 33%. Half. And if we take inflation out of the equation, things get worse: the average real wage grew by a meager 9%, while the minimum wage grew by 34%.

This is not just unfair. It's absurd from an economic point of view. Thomas Piketty, a French economist, said that inequality is not only a matter of social justice, it's also a matter of economic efficiency. If we eliminate incentives for people to get qualified, to advance in their careers, we are killing productivity.

Joseph Stiglitz, Nobel Prize winner in Economics, says something similar: an economy functions better when workers are well paid for what they do. It's not about giving the bare minimum to the maximum number of people possible. It's about creating a structure where those who work harder, those who are more qualified, those who have more experience, earn more. It seems obvious, but apparently it isn't.

Let's take teachers as an example. The profession I practice. A teacher at the beginning of their career earns 1,714 euros gross in 2025. After deducting income tax, social security contributions, and health insurance (ADSE), if they are single and without children, they take home 1,360 euros net. The minimum wage in 2026 will be 920 euros. The difference? 440 euros.

This is ridiculous for someone with a five-year degree, who trains the next generations, who has an enormous responsibility. Four hundred and something euros more than the minimum.

But it gets better. The INE (National Institute of Statistics) says that the average salary for someone with a bachelor's degree in Portugal is €2,414 gross. Do you know when a teacher reaches that amount? In the 6th or 7th career step. That is, after 18 to 22 years of teaching. Two decades. And this assumes there are no freezes or delays, which would be a joke if it weren't tragic, because in recent years there have been many.

Twenty years to reach the average salary for your educational level. Twenty years. Is that acceptable? Of course not.

And on top of that, when you try to earn more, the State squeezes you. Portugal is the second country in Europe – among those with average annual salaries below €25,000 – that most severely penalizes those who double their average salary fiscally. The OECD data is clear: the tax burden increases by 7.4 percentage points. Only Greece is worse.

If you earn €1,572 (the average salary), you pay 39.4% in taxes and contributions. If you earn double that, you pay 46.8%. Almost half your salary. In a country where you already earn little, you are punished for earning more. Does that make sense? It makes no sense at all.

Portugal has the lowest net salaries in Western Europe. On average, a worker takes home €16,000 a year. But the employer pays €27,000, because 42% goes directly to the state. It has the eighth highest tax burden in Western Europe.

Looking at Switzerland, where workers earn €41,000 net per year (adjusted for the Portuguese cost of living) and the tax burden is 23%, it's not magic. It's a country that decided that creating value and paying people well was a priority.

Paul Krugman, another Nobel laureate economist, says something I completely agree with: higher wages are not a problem for economic growth, they are a condition. This idea that paying people well harms the economy is nonsense. Prosperous countries pay well. Poor countries pay poorly. It's that simple.

The solution isn't to stop raising the minimum wage. The solution is to raise everything. The entire wage structure needs to change. Yes, lowering taxes helps. Lower income tax for the middle class, lower contributions for companies, simplifying the tax system – all of that is important. But it's not enough.

We all know that you can't create prosperity with tax tricks alone. You need serious investment in people and paying them well for what they do.

Portugal loses thousands of qualified young people every year. Engineers, doctors, nurses, teachers, IT professionals – they leave. Why? Because they are paid three times as much abroad, sometimes more. An engineer in Portugal earns a fraction of what they earn in Germany. A teacher earns less than half of what they earn in other Western European countries.

And then we complain that there's a shortage of teachers, a shortage of doctors, a shortage of skilled workers. Of course there is. Nobody wants to work for these salaries when they can earn much more elsewhere.

Do we want Portuguese workers? Then pay them. Pay them properly. Pay them in a way that makes it worthwhile for them to stay. Pay them in a way that a young person finishing their degree doesn't look at their starting salary and think, "Wait, I'm going to spend 5 years at university to earn this?"

A society that doesn't value knowledge and competence ends up losing both. This is what's happening in Portugal. We are losing the best because we don't pay them what they deserve.

A minimum wage of 1,100 euros in 2029 is fair and necessary. But if we get there and the average wage remains where it is, we're going to have a huge problem. We're going to tell kids that studying isn't worth it. We're going to tell professionals that career advancement isn't worth it. We're going to tell qualified people to go to another country.

Portugal needs a serious wage policy. One that raises the minimum wage, but also values ​​those in the middle and at the top. One that lowers taxes on labor. One that encourages companies to pay better. One that recognizes that decent wages are not a luxury – they are an investment.

The question is simple, and I've already stated it: do we want qualified Portuguese workers? Then it's time to pay them what they deserve. Because, and economics teaches us this, countries that don't pay their people well end up losing them. And when that happens, no government or policy can recover decades of talent that have gone. The example of teachers is paradigmatic.

Portugal is at a crossroads. Either we continue down this path of mediocre wages for everyone, or we change course and build a country where working, studying, and acquiring qualifications truly pays off. The numbers are there. The problems are obvious. What's lacking is the political courage to do what needs to be done?

And for those in power: raising the minimum wage is easy and popular. Raising all salaries is difficult and unpopular with those who only want cheap labor. But it's what has to be done. Otherwise, in 10 years we'll still be wondering why all our children are out there.

Sources: Instituto +Liberdade – https://maisliberdade.pt; OECD – https://www.oecd.org; National Institute of Statistics – https://www.ine.pt