Portugal Hires Thousands More Civil Servants, Easing Queues but Raising Costs

Waiting times at local clinics are easing, fresh teachers are turning up in classrooms and city-hall counters have new faces ready to help in English—signs that Portugal’s public payroll is growing again, even though Lisbon politicians had promised to slam on the brakes.

Why the spike matters for residents and investors

Portugal now employs 760 728 people across all layers of government, a record head-count that is 1.5 % higher than a year ago and 0.2 % above the previous quarter. For foreigners who rely on the National Health Service (SNS), send their children to state schools or deal with municipal licensing, the expansion could translate into shorter queues and faster paperwork. At the same time, a bigger payroll means the Budget deficit faces additional strain—something that matters to expats watching the country’s tax climate, property rules and overall economic stability.

Where the jobs were added—and why

The bulk of new positions surfaced in three pockets:Health: 3 656 hires—mostly 1 258 nurses, 667 diagnostic technicians and 606 technical assistants—tackle post-pandemic backlogs and an aging population.Education: 3 019 contracts brought in 1 125 kindergarten through secondary teachers, 829 school aides and 652 senior specialists, addressing chronic teacher shortages that worried many international families.Local government: 4 705 newcomers strengthened câmaras municipais and freguesias (parishes), filling gaps in senior-technician, technical-assistant and operational-assistant roles. If you are renovating a home or registering a business, these hires are the people who stamp your paperwork.

Whatever happened to the “one-in, one-out” pledge?

Finance Minister Joaquim Miranda Sarmento had vowed that every retirement would be matched by just one new contract, aiming to freeze public staffing at roughly 746 700 positions. Yet between January and June alone, 11 030 posts were created while only 10 366 employees left, largely through retirement. Officials argue that critical shortages in family medicine, special education and frontline municipal services forced temporary exceptions. The fine print of the Orçamento do Estado does allow ministries to hire above the ceiling if another ministry under-hires, but the latest figures suggest the compensations never balanced out.

Pay cheques break a psychological barrier

For the first time, the average gross salary in the função pública climbed above €2 200, landing at €2 223.70 in April. That is a 6.9 % annual jump and reflects not just higher base pay—now €1 863.40 on average—but also richer overtime, supplements and bonuses. By comparison, median private-sector pay remains closer to €1 100, so the widening gap may fuel public debate on fairness, especially as inflation cools. Foreign taxpayers with Portuguese income should note that public-sector wage hikes influence negotiations in the private sector and can nudge social-security contributions higher.

How Portugal stacks up against its neighbours

Even after the surge, government workers represent roughly 14 % of Portugal’s labour force, below the EU average of about 16 % and far beneath France’s ≈21 %. Spain sits near 15 %. The lighter footprint has long been cited by Lisbon when courting digital nomads and foreign investors—proof, officials say, that the country is not a bureaucracy-heavy outlier. Still, watchdogs such as the Conselho das Finanças Públicas (CFP) warn that rapid hiring plus generous pay deals can create “durable costs” that are hard to unwind once economic growth slows.

What to watch through 2026

No public body—neither the UTAO nor the Tribunal de Contas—has yet put a price tag on how the extra 11 000 staff and higher wages will swell the 2025-26 Budget bill, but analysts expect personnel costs to breach €24 B for the first time next year. With Brussels urging member states to narrow deficits, the government may soon have to revisit the one-in, one-out rule in earnest—or raise revenue through property levies, fuel excise or other taxes that foreigners feel directly. Keep an eye on the 2026 draft Budget this autumn; it will signal whether Portugal chooses further expansion of public services or opts for a pause to consolidate its finances.