Portugal’s second general strike in four months caused widespread disruption on Thursday.
But support for the 24-hour stoppage fell amid signs that many workers saw labour reforms and austerity measures as inevitable.
Portugal is among several eurozone countries, including Italy and Spain, pressing ahead with reforms to introduce more flexibility into labour markets in the face of trade union opposition.
But the lower turnout for Thursday’s strike highlighted a split within the Portuguese labour movement over reform measures agreed with the European Union as part of a €78bn financial adjustment programme.
The strike was called by the communist-leaning CGTP-Intersindical, the country’s biggest union confederation. But the União Geral de Trabalhadores (UGT), the second largest and more moderate union movement, opted not to support the protest after signing up to a labour pact with the government and employers’ organisations in January.
The two groups joined forces four months ago to stage the country’s biggest general strike in 30 years. But João Proença, the UGT leader, said another strike was not the best way to fight rising unemployment.
Portugal’s jobless rate reached 14 per cent in December and is forecast to continue climbing into 2013. The youth unemployment rate is above 28 per cent.
The strike brought public transport in Lisbon and Porto almost to a standstill. It also hit ports, shipyards, schools, hospitals, courts and other public services.
The public transport sector, with an estimated debt of €17bn, faces sweeping reforms under the terms of the rescue programme. But most private sector companies continued working.
A union representative at the AutoEuropa Volkswagen plant near Lisbon, where production was expected to drop 5 per cent on Thursday, said it was becoming increasingly difficult for workers to strike and lose a day’s pay as austerity hit family budgets.
“Demonstrations and strikes run the risk of becoming banal and ineffective as a form of pressure,” Público, a leading daily, said in an editorial. “It is not to be expected that today’s strike will help find solutions for the difficulties the country is facing.”
Luís Marques Guedes, a spokesman for the centre-right coalition government, said he was confident that “the overwhelming majority of the population believes that a general strike in the current circumstances will do little or nothing to resolve our problems”.
Tens of thousands of protesters supporting the strike marched in Lisbon and other cities. Like previous anti-austerity demonstrations in Portugal, the strike and marches were generally orderly and peaceful but three people, including a press photographer, were injured in Lisbon when police charged a small group of young demonstrators not belonging to the CGTP. A police spokesman said they were throwing objects at police.
Arménio Carlos, the CGTP leader, said austerity measures and labour reforms tabled by the government would lead to wage losses of up to 25 per cent for many workers.
“This is the path they followed in Greece and result was a tremendous failure,” he said.
In addition to pay cuts and tax increases, the labour reforms will make it easier and cheaper for companies to fire workers. They will also introduce more flexible working hours, reduce holidays and lower overtimes rates.
Tough government austerity measures will contribute to a forecast 3.3 per cent contraction in the economy this year, after it shrank 1.6 per cent in 2011.
Economists remain sceptical that growth will pick up in 2013, as the government forecasts, or that Lisbon will be able to return to the international debt market in September next year, as envisaged in the bailout agreement.
Many analysts believe Lisbon will need to ask the European Union and the International Monetary Fund for more financial support – an idea that the government has repeatedly rejected.
Yields fell significantly in an auction of 12-month and 4-month Treasury bills on Wednesday. “This is definitively good news for Portugal and shows that the perception of the country’s risk is substantially improving,” said Filipe Silva, head of public debt at Banco Carregosa.
But official data released on Wednesday also showed that public spending rose 3.5 per cent in the first two months of 2012 compared with the same period last year, while revenue fell 4.3 per cent.
Commerzbank said the figures had moved Portugal’s 2012 budget deficit target “further out of sight” but noted that Greece, Italy, Ireland and Spain also reported weaker January deficit figures than a year before.
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