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Dismissing staff is the most popular cost-cutting strategy used by companies, concluded a study by the Bank of Portugal.

The second most frequently applied measure is the reduction or suspension of benefits, according to the Summer Economic Bulletin (Boletim Económico de Verão).

Around 72% of companies reduced expenses by cutting back on staff while 30% took on new employees after dismissals but paying lower wages.

The study analysed the cost-cutting policies of 757 companies from various sectors employing more than 10 workers.