17 October: International Day for the Eradication of Poverty

17 October: International Day for the Eradication of Poverty

17 October: International Day for the Eradication of Poverty

The FINANCIAL -- In 2017, 112.9 million people, or 22.5% of the population, in the European Union (EU) were at risk of poverty or social exclusion.This means that they were in at least one of the following three conditions: at risk of poverty after social transfers (income poverty), severely materially deprived or living in households with very low work intensity.

After three consecutive increases between 2009 and 2012 to reach almost 25%, the proportion of persons at risk of poverty or social exclusion in the EU has since continuously decreased to 22.5% last year, 1.2 percentage points below its 2008 reference-point and 1 percentage point below the 2016 level. The reduction of the number of persons at risk of poverty or social exclusion in the EU is one of the key targets of the Europe 2020 strategy.

Highest at risk of poverty or social exclusion rate in Bulgaria, lowest in the Czech Republic

In 2017, more than a third of the population was at risk of poverty or social exclusion in three Member States: Bulgaria (38.9%), Romania (35.7%) and Greece (34.8%). At the opposite end of the scale, the lowest shares of persons being at risk of poverty or social exclusion were recorded in the Czech Republic (12.2%), Finland (15.7%), Slovakia (16.3%), the Netherlands (17.0%), Slovenia and France (both 17.1%) and Denmark (17.2%).

Largest decrease in Poland, highest increase in Greece

Among Member States for which 2017 data are available, the at risk of poverty or social exclusion rate has grown since 2008 in ten Member States, with the highest increases being recorded in Greece (from 28.1% in 2008 to 34.8% in 2017, or +6.7 percentage points), Italy (+3.4 pp), Spain (+2.8 pp), the Netherlands (+2.1 pp), Cyprus (+1.9 pp) and Estonia (+1.6 pp). In contrast, the largest decrease was observed in Poland (from 30.5% to 19.5%, or -11.0 pp), followed by Romania (-8.5 pp), Latvia (-6.0 pp) and Bulgaria (-5.9 pp).
About 1 in 6 persons in the EU at risk of income poverty…

Looking at each of the three elements contributing to being at risk of poverty or social exclusion, 16.9% of the EU population were at risk of poverty after social transfers in 2017, meaning that their disposable income was below their national at risk of poverty threshold. This proportion has slightly decreased compared with 2016 (17.3%) but is still higher than in 2008 (16.6%). As the thresholds reflect actual income distribution in the countries, they vary greatly both between Member States and over time.

Across the EU Member States, more than 1 in 5 persons were at risk of income poverty in Romania (23.6%), Bulgaria (23.4%), Lithuania (22.9%), Latvia (22.1%), Spain (21.6%), Estonia (21.0%), Italy (20.3%) and Greece (20.2%). In contrast, the lowest rates were observed in the Czech Republic (9.1%), Finland (11.5%), Denmark and Slovakia (both 12.4%), the Netherlands (13.2%), France and Slovenia (both 13.3%) and Hungary (13.4%). Compared with 2008, the proportion of persons at risk of income poverty has increased in nineteen Member States, for which data are available, remained stable in one and decreased in seven.

About 1 in 6 persons in the EU at risk of income poverty…

Looking at each of the three elements contributing to being at risk of poverty or social exclusion, 16.9% of the EU population were at risk of poverty after social transfers in 2017, meaning that their disposable income was below their national at risk of poverty threshold. This proportion has slightly decreased compared with 2016 (17.3%) but is still higher than in 2008 (16.6%). As the thresholds reflect actual income distribution in the countries, they vary greatly both between Member States and over time.

Across the EU Member States, more than 1 in 5 persons were at risk of income poverty in Romania (23.6%), Bulgaria (23.4%), Lithuania (22.9%), Latvia (22.1%), Spain (21.6%), Estonia (21.0%), Italy (20.3%) and Greece (20.2%). In contrast, the lowest rates were observed in the Czech Republic (9.1%), Finland (11.5%), Denmark and Slovakia (both 12.4%), the Netherlands (13.2%), France and Slovenia (both 13.3%) and Hungary (13.4%). Compared with 2008, the proportion of persons at risk of income poverty has increased in nineteen Member States, for which data are available, remained stable in one and decreased in seven.

… 1 in 14 severely materially deprived…

In the EU in 2017, 6.9% of the population were severely materially deprived, meaning that they had living conditions constrained by a lack of resources such as not being able to afford to pay their bills, keep their home adequately warm, or take a one week holiday away from home. This proportion has decreased compared with both 2016 (7.5%) and 2008 (8.5%). The share of those severely materially deprived in 2017 varied significantly among Member States, ranging from 30.0% in Bulgaria, 21.1% in Greece and 19.7% in Romania, to less than 4% in Sweden (1.1%), Luxembourg (1.2%), Finland (2.1%), the Netherlands (2.6%), Denmark (3.1%), Malta (3.3%), Germany (3.4%), Austria and the Czech Republic (both 3.7%). Compared with 2008, the proportion of persons severely materially deprived has increased in nine Member States for which data are available, and decreased in eighteen.

…and 1 in 11 living in households with very low work intensity

Looking at low work intensity, 9.3% of the population aged 0-59 in the EU lived in households where the adults worked less than 20% of their total work potential during the past year. This proportion has decreased significantly compared with 2016 (10.5%) and is close to the 2008 level (9.2%). Ireland (18.2% in 2016), Greece (15.6%), Belgium (13.5%), Croatia (13.0% in 2016), Spain (12.8%), and Italy (11.8%) had the highest proportions of those living in very low work intensity households, while Slovakia (5.4%), the Czech Republic (5.5%), Poland (5.7%), Estonia (5.8%) and Slovenia (6.2%) had the lowest. Compared with 2008, the share of persons aged 0-59 living in households with very low work intensity has increased in eighteen Member States for which data are available, and decreased in nine.

The at risk of poverty rate is the share of people whose total household income (after social transfers, tax and other deductions), available for spending or saving, is below the at risk of poverty threshold, which is set at 60% of the national median equivalised disposable income after social transfers.This indicator does not measure wealth or absolute poverty but low income in comparison to other residents in that country.

The threshold depends on the income distribution in a country for a given year and varies with the composition of a household. It is therefore important to note that the ‘at risk of poverty rate’ is a relative measure of poverty and that the threshold varies greatly between Member States. It also varies over time as it follows the evolution of the national median disposable income: in a number of Member States the threshold has fallen over the period 2008-2017 (Greece and Cyprus) or stayed nearly stable (Spain and Italy).