Women and Young Workers Face Underemployment Crisis in Portugal: What You Need to Know

Portugal's involuntary part-time employment has climbed to 2.2% in 2025, reflecting persistent structural inequalities in the labor market — particularly among women who shoulder disproportionate caregiving burdens. The latest data from the Portugal National Statistics Institute (INE), released ahead of International Workers' Day, underscores a deeper problem: even as overall joblessness hovers near the European average, underutilized workers — those unemployed, involuntarily part-time, or available but discouraged — still represent 10.3% of the active population.

Why This Matters:

• Gender gap persists: Women account for the bulk of involuntary part-time roles, driven by caregiving duties and sector segregation into lower-paid industries.

• Youth vulnerability: Portugal's youth underutilization rate reached 30.8%, above the EU-27 average of 28.7%, with more than half explained by unemployment alone.

• Below EU average overall: Portugal's general underutilization rate of 10.3% sits comfortably below the EU-27 mark of 11.7%, yet masks pockets of severe slack.

• Policy momentum: The government has rolled out emergency measures — including IRT Jovem and Programa +Talento — to encourage hiring and subsidize internships through June 2026.

The Structural Weight of Involuntary Part-Time Work

Involuntary part-time employment — known formally as underemployment — captures workers who hold fractional contracts but want and are available for additional hours. In 2025, involuntary part-time workers accounted for 2.2% of the workforce, representing 21.6% of all underutilized labor according to INE data.

This figure of 2.2% places Portugal close to the EU-27 average of 2.4% for part-time underemployment. Yet the composition tells a more troubling story. The overwhelming majority are women, trapped between high educational attainment and an economy that shunts female workers into sectors with shorter hours and lower pay.

Despite women in Portugal averaging higher schooling levels than men, they cluster in education, health, and social support — sectors where they represent 73% to 80% of the workforce but where compensation lags. Meanwhile, they occupy only 15.7% of CEO and executive roles at the nation's largest companies, evidence of what researchers call a "talent funnel" or glass ceiling. This segregation directly fuels the underemployment gap, as women sacrifice full-time contracts to manage unpaid domestic and care responsibilities that fall disproportionately on their shoulders.

Gender and Youth: The Double Bind of Underutilization

Portugal's broader labor underutilization indicator aggregates four groups: the officially unemployed, involuntary part-timers, inactive people seeking work but unavailable, and inactive people available but not searching. The INE reports that in 23 of the 27 EU member states, women's underutilization rates exceed men's — and Portugal is no exception.

In 2025, the unemployment rate stood at 6.4% for women versus 5.5% for men. When underutilization is factored in, the gender gap widens further, driven by women's greater share of involuntary part-time work and their lower availability for full-time employment. This lower availability reflects structural inequalities: women continue to shoulder the bulk of unpaid care for children and elderly relatives, constraining their time for paid work, professional development, and career advancement.

Young workers face a parallel crisis. Portugal's youth underutilization rate hit 30.8% in 2025, surpassing the EU-27 average of 28.7%. Over half of that figure stems from outright unemployment — which stood at 19.5% for workers aged 15–24 at the end of 2025, down 2.1 percentage points from the prior year yet still triple the national average. By March 2026, youth unemployment had edged down to 18.1%, the lowest since October 2022, but remains a policy headache for Lisbon.

Unlike the 25–54 and 55–74 age cohorts, young people confront a landscape of temporary contracts, unpaid internships, and over-qualification for the roles they secure. Nearly 43.5% of young female immigrants held temporary contracts in 2023, underscoring how precarity intersects with gender, age, and migration status.

How Portugal Compares Within the EU-27

When plotting member states by unemployment and underutilization against the EU-27 averages — 6.0% and 11.7% respectively in 2025 — Portugal lands in an interesting quadrant. Its unemployment rate of 6.0% matches the Union mean precisely, but its underutilization rate of 10.3% sits 1.4 percentage points below the bloc's average. This suggests a labor market that activates available workers relatively well, yet leaves young people and women in a holding pattern of insufficient hours or discouraged participation.

For context, in 2013 — when Portugal's jobless rate peaked at a historic 17.2% — the active population represented only 89% of the broader potential workforce. By 2025, that figure had climbed to 98%, evidence of improved activation. Still, the remaining 2% gap and the concentration of underutilization among specific demographics signal that cyclical recovery alone has not erased deep-rooted imbalances.

What This Means for Residents

If you are a woman returning to work after maternity leave, expect to encounter employer skepticism and fewer full-time openings in your field, especially if you work in social services or education. Part-time schedules may be offered by default, and negotiating upward can prove difficult when sectoral norms and caregiving expectations reinforce the status quo. Over a career, these constraints translate into lower lifetime earnings and smaller pension pots, raising the risk of old-age poverty.

Young job-seekers should explore the suite of active measures managed by the Portugal Employment and Professional Training Institute (IEFP). The Programa +Talento finances up to 15,000 internships for unemployed graduates under 35, guaranteeing pay no lower than a public-sector degree-holder's salary and incentivizing permanent contracts. The Programa +Emprego supports 20,000 open-ended hires, waiving the typical three-month waiting period for youth registrants. And the IRT Jovem emergency scheme — valid through 30 June 2026 — lets workers under 30 who sign a new contract pocket 35% of their monthly unemployment benefit if the deal is permanent, or 25% if it runs at least six months at full-time hours.

Employers stand to gain as well. Government co-financing can offset recruitment costs, and demographic trends — an aging population and net emigration of young talent — mean retaining skilled workers now will pay dividends later.

Policy Outlook and Structural Barriers

Lisbon's current legislative framework, anchored by Decree-Law 13/2015, commits the state to full employment and youth labor-market insertion. The revamped Garantia Jovem (Youth Guarantee), aligned with a 2020 European Council Recommendation, promises every person under 30 an offer of employment, training, education, or internship within four months of leaving school or becoming unemployed.

Yet progress remains uneven. Portugal has slipped in some workplace-equality benchmarks relative to peer EU nations, and the gender pay gap has widened in certain high-skill occupations despite women's superior qualifications. Cultural norms that associate caregiving with femininity persist, and inadequate public childcare infrastructure forces many families to rely on maternal labor.

Without targeted interventions — affordable daycare, parental-leave reforms that encourage fathers to share time off, and enforcement of equal-pay statutes — involuntary part-time work will continue to function as a pressure valve for deeper inequities. The 2.2% figure is not merely a labor-market statistic; it reflects real barriers that women and young people face in accessing full-time, stable work.

The Road Ahead

The INE data reveal a Portuguese economy that has rebounded impressively from the 2013 crisis peak, absorbing most of its potential workforce. Underutilization remains below the European average, and targeted programs are beginning to reduce youth unemployment. But these gains mask a harder truth: tens of thousands of women are working fewer hours than they need, and young people are cycling through precarious jobs that don't match their skills.

For policymakers, the priorities are clear: keep funding hiring schemes while tackling root causes — segregated sectors, unequal care burdens, and workplace bias — that trap women and youth in underemployment. For residents, understanding these trends can inform your career planning, wage negotiations, and efforts to protect your workplace rights. The numbers show Portugal is moving forward; the question is whether it will move fast enough to close the gaps that still define its labor market.