Average income in foreign subsidiaries is €1,351, against €943 in domestic companies

  • ECO News
  • 19 November 2018

There were 6455 foreign subsidiaries in Portugal, which accounts for 1.6% of the non-financial sector's production. The average income in these (€1,351) was higher than in national companies (€943).

The 6455 subsidiaries of foreign companies operating in Portugal, which amount to 1.6% of the country’s non-financial sector, represented 25.3% of the total business volume, 24.1% of total GVA (Gross Value Added), and 15.2% of the total staff employed. These results were published by the National Statistics Office this Monday, and they refer to the statistics from foreign subsidiaries economic activity in 2016 and estimations for 2017.

The average productivity of a worker in these foreign companies operating in Portugal was superior to that of national companies, with a difference of about 18,1 thousand euros. The average income of those working for foreign subsidiaries was €1,351 in 2017, higher than the average income earned by those employed in national companies (€943) in the same period.

Average income in foreign subsidiaries in the non-financial sector was higher than the average for all the companies in the non-financial sector, representing a growth of 0.5%. These affiliates employed around 448 thousand people, which accounts for a 5% growth.

Companies with a focus on exports were responsible for 37.3% of the total GVA produced by foreign subsidiaries in Portugal, having also seen a 9.5% growth in their VAB. Around 75% of the subsidiaries in Portugal had their headquarters in European Member-states, with special highlight to Spain, France and Germany.

The investment rate was also higher for these companies, at 24.2%, against the domestic companies’ investment rate of 20.6%.

GVA increased by 5.3% in nominal terms, reaching €20.3 bn. The amount spent by these companies on salaries increased by 6.5% in 2017 (+4.2% in 2016), corresponding to €8.4bn in total. The weight of salaries on GVA increased from 40.5% in 2016 to 41% in 2017.

Of all the foreign subsidiaries, 404 were full-scale companies; these were, in turn, responsible for €13.7bn of the GVA, which represents an increase of 7.4% in comparison to 2016. These full-scale foreign companies employed around 318 thousand people, a 6.5% increase in comparison to 2016.