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Summing up, the job market in December kept the recent trend, namely Employed population growing above Active population so unemployment rate continues to adjust, 5.59% a new recent low. We foresee this trend to remain in place over the coming months, as the new immigration policies should slowdown the growth rates of the Active population. Meanwhile, in 2025 the Employed population grew 3.6%YoY, while the GDP would grow around 2%; a strong negative impact in terms of productivity.

The INE (Portuguese Statistic Institute) has just released December’s job preliminary data, namely Rate of Unemployment, Under Utilization Rate, Employed Population and Underutilization Population.    

The main highlights are the following:

1 – Unemployment rate in December, 5.59% (-7bpMoM); compares with 12MMA (12 months moving average): 6.05% and 3MMA: 5.70%;

2 – The Under-Utilization rate (takes in consideration the under-utilization population divided by a broad concept of Active population) went down 18bpMoM to 9.66%; compares with 12MMA: 10.30% and 3MMA: 9.85%;

3 – The Inactive Population went down -142bp YoY vs. 12MMA: -167bp and 3MMA: -134bp (-33bpMoM);

4 – Active population went up 2.7%YoY vs. 12MMA: 2.79% and 3MMA 2.67% (+24bp MoM):  

5 – The Employed population went up 3.6%YoY vs. 12MMA +3.25% and 3MMA 3.57% (+32bp MoM).

Our comments: the job market, in December, kept the recent trend, namely Employed population +3.6%YoY/+32bpMoM; growing above Active population, +2.7%YoY/+24bpMoM; so, Unemployment rate adjusted, 5.59%; below moving averages. We believe, this recent trend should continue, over the coming future, as the new immigration policies should slowdown the growth rates of the Active population. Finally, employed population is growing above 3%, while the GDP is growing around 2%, so productivity was clearly negative in 2025. In the future, productivity will need to increase again and unemployment could increase.

Source: INE, AS Independent Research