Social trends and dynamics of poverty and social exclusion ESDE conference Brussels 06/02/2013
1-in-4 people in the EU at risk of poverty or exclusion 27% of working age population at risk of poverty for at least one year in period 2006-2009
Main Topics 1) Recent social trends: extent and depth of poverty and social exclusion multi-dimensional nature diverging impacts across Member States and population groups 2) Dynamics/persistence of poverty and deprivation What do we mean by dynamics of poverty? How can analysing it lead to a better understanding?
Recent social trends
Definition of poverty and social exclusion EU definition "persons, families and groups of persons whose resources (material, cultural and social) are so limited as to exclude them from the minimum acceptable way of life in the Member State in which they live -> wide range of issues beyond income poverty
Population living at-risk-of-poverty-orsocial exclusion covers: At-risk-of-poverty: people with an equivalised disposable income below the poverty threshold (set at 60 % of national median disposable income (after social transfers)) Severe material deprivation: people whose living conditions are severely constrained by a lack of resources (i.e. experience at least 4 out of 9 key aspects of deprivation) Living in HHs with very low work intensity: people aged 0-59 living in HHs where the adults worked < 20 % of their total work potential during the past year (~ jobless HHs) => takes account of diversity of situations across EU
Poverty and social exclusion on the rise in the EU rise in no. of people living in VLWI HHs (+ recently AROP and SMD) 1-in-4 at-riskof-poverty or exclusion in 2011
Strong divergence across Member States in trends post-2008 Strong rises in southern and peripheral MS Little change in northern and central MS Declines in a few (e.g. PL & RO) Disparity increasing
Rise in very low work intensity households in most MS..
often associated with rise in severe material deprivation rate BUT in some MS, reflecting improvement in living standards
Impact of crisis not uniform across population subgroups By age group AROPE for: Youth and prime working age adults: ~2 pps Children: 0.8 pps 65+ grp: 3 pps
Poverty Gap Developments in severity of poverty Chart : Developments over 2008-2011 in the poverty gap and the risk of poverty across EU Member States in 2011 Poverty gap Up in most MS more cases signif. rises than rate ~30% in BG, LV, LT, RO, ES Combining extent and severity: Poverty esp of concern in: BG, LV & RO Changes 2008-2011 in percentage points AROP Poverty Gap BE 0.6 1.4 BG 1.0 2.0 CZ 0.8-1.3 DK 1.2 3.4 DE 0.6-0.8 EE -2.0 5.7 IE* 0.6-2.5 EL 1.3 1.4 ES 2.2 7.2 FR 1.3 2.3 IT* -0.5 1.5 CY* 0.1 1.5 LV -6.3 3.1 LT 0.0 3.0 LU 0.2-0.9 HU 1.4 1.0 MT 0.4-2.7 NL 0.5 0.6 AT 0.2 3.7 PL 0.8 0.8 PT -0.5 0.0 RO -1.2-0.5 SI 1.3 0.6 SK 2.1 4.7 FI 0.1-2.2 SE 1.8 0.5 UK* -1.6 0.4 35 30 25 20 15 10 HU CZ FR LV RO ES LT BG EE EL IT* SK EU27 PT DE DK PL UK* SI AT SE NL LU FI 2011 BE CY* MT IE* 5 10 15 20 25 30 AROP + EL, LT & ES Source: Eurostat, EU-SILC. Note: changes in AROP and Poverty gap > 1 percentage point highlighted in grey. *Figures for CY, IE, IT and UK are for 2010 instead of 2011. 2011 EU27 figure is Eurostat estimate.
Increasing Financial distress Share of lowest quartile HHs facing financial difficulties over year to mid-2012 in most MS marked rise in IT (~10 pps) Longer-term perspective much worse vs pre-crisis in CY, EL, IT and ES
Inability to face unexpected expenses
Dynamics of poverty "the passage of time is intimately connected with the nature of poverty that individual experience" Pr. S. Jenkins What does it mean? What do we know? What can we do?
Dynamics of poverty: what are we talking about? Static approach Dynamic approach Non poor Non poor Poor Poor time time
Poverty and the passage of time Never poor Poverty line Transient poor Recurrent poor Persistent poor Time Poor at least once 17
Poverty experience is wide-spread Whole population 100 % Poor at least one year 27% 15% At risk of poverty Persistently poor 7% EU 27, 2006-2009, EU-SILC, 18-64 population
% of the 18-64 population National differences Chart: Risk of poverty & persistence of poverty 20 At risk of poverty rate Persistent risk of poverty 15 10 5 0 BE FR DK UK EE PT BG 19
Exit rate out of poverty "Looking at entries and exits separately rather than at poverty itself" (Jenkins) Low entry & low exit rates framework favourable Risk 60% of social polarisation 50% 40% 30% 20% 10% CZ CY DK SI NL SE LU FI FR BE SK AT IE HU PT IT RO PL EE LT BG UK ES EL LV MT High turnover of poverty framework favourable does not exclude risks of recurrence risk of 'core bulk permanently poor' High entry & low exit rates Risk of massive poverty trap. 0% 0% 3% 5% 8% 10% 2006-2009, EU-SILC, 18-64 population Entry rate into poverty
Profiling of the working-age population poor at least one year UK 2006-2009, EU-SILC, 18-64 population
Which individuals are facing poverty?... and how long? UK CZ IT 2006-2009, EU-SILC, 18-64 population
An illustration: obstacles for women with children Barriers to access the labour market Access to childcare Unsufficient earnings Precarious employment Gender pay gap Disincentive tax-benefit schemes Inactivity / low wage traps for second earner Impact of benefits
An illustration: obstacles for women with children 2006-2009, EU-SILC, 18-64 population
Conclusion Poverty is rising and deepening In some Member States For some population subgroups Dynamic approach can help to tackle it Understand the flows Profiling individuals and adress their obstacles Rising poverty and exclusion: Focusing on its dynamics to better understand it
Thank you for your attention
Exit rate out of risk of poverty Ins & outs of poverty between 2007-2010 60% FR UK ES PT ES UK 40% PT IT FR IT FR 20% -1% 1% 3% 5% 7% 9% 11% 13% 15% Entry rate into risk of poverty