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Data from April 2009, most recent data: Further Eurostat information, Main tables and Database.
Figure 1. At-risk-of-poverty rate and at-risk-poverty threshold in the EU (%), 2007[1]

Social inclusion has long been a key part of European Union (EU) policies. The overriding goal is to reduce substantially the number of people at risk of poverty and social exclusion, thereby creating a socially inclusive society.

However, as multi-dimensional concepts, poverty and social exclusion cannot easily be measured through statistics. As a result, both monetary and non-monetary indicators have been developed, such as the at-risk-of-poverty rate, the at-risk-of-poverty threshold, the income quintile share ratio and the material deprivation rate. Other equally relevant factors should also be considered: access to employment, education and training, health, or housing.

This article looks at recent European statistical data on social inclusion, from all these angles.

Main statistical findings

At-risk-of-poverty rate and threshold

In 2007, approximately 79 million people (16 %) in the EU lived below the poverty threshold, a situation likely to hamper their capacity to participate in society fully. However, this percentage varied within Europe. For instance, at one extreme, Member States with the highest poverty rate are the Baltic countries: Latvia (21 %), Lithuania (19 %), Estonia (19 %), as well as Greece, Spain and Italy (all 20 %), and the United Kingdom and Romania (both 19 %). At the other extreme, the share of the population at risk of poverty is around 10 % in the Czech Republic, the Netherlands and Iceland, and 11 % in Sweden and Slovakia.

The at-risk-of-poverty rate is also used with various breakdowns to draw a broader picture of social exclusion in the EU. For instance, it is analyzed by age group and gender. The impact of social protection systems on the poverty level is also highly relevant.

However, the choice to set the poverty threshold at 60 % of the national median equivalized disposable income is conventional. In each country, it represents the level of income considered necessary to lead an adequate life. When taking into account the differences in the cost of living (values expressed in purchasing power standard (PPS)), the poverty threshold for a single-person household varies from less than PPS 4 000 in Bulgaria, Latvia, Poland, Lithuania and Hungary up to more than PPS 10 000 in eight Member States. This suggests that the standard of living of the poor is three to four times higher in the countries with the highest income than in the countries with the lowest income.

Income inequalities

Figure 2. Income quintile share ratio (S80-S20) in the EU(%), 2007[2]

Another interesting facet of social inclusion is the income distribution reflected in the S80/S20 ratio, which indicates the relative position of the bottom income quintile with regard to that of the top income quintile. In 2007, the ratio was 4.8 for the EU, meaning that the wealthiest quintile had nearly five times more income than the poorest. Ratios range from 3.3 in Slovenia and 3.4 in Sweden to 6.5 in Portugal and 6.3 in Latvia. While inequality in the income distribution is high in all southern countries and the United Kingdom and low in all Nordic countries, the situation varies widely among the Member States that have joined the EU since 2004, with high levels of the ratio in the three Baltic countries plus Romania and Poland, as opposed to all the other countries in this group.

Material deprivation

Figure 3. Material deprivation rate in the EU(%), 2007 [3]

While the former indicators measure relative poverty expressed in monetary terms, the material deprivation rate follows a more absolute approach in expressing the inability to afford some items considered desirable or even necessary by most people to lead an adequate life. The indicator distinguishes between individuals who cannot afford a certain good or service, and those who do not possess this good or service for another reason, e.g. because they do not want or do not need it.

In 2007, 17 % of the EU population was considered materially deprived, with great discrepancies between the pre- and post-2004 Member States. On the one hand, only 3 % of the population was deprived in Luxembourg and 10 % or less in all the Nordic countries, the Netherlands, Austria, Spain, Ireland and the United Kingdom. On the other hand, the material deprivation rate exceeded 50 % in Romania, was 40 % in Latvia and over 30 % in Poland, Hungary, Cyprus, Slovakia and Lithuania.

Other indicators

Under the open method of coordination, the Social Protection Comittee adopted, in May 2006, a portfolio of overarching indicators complemented by specific indicators on social inclusion, pensions and health.

Data sources and availability

The EU-SILC instrument was launched in 2003 on the basis of a 'gentleman’s agreement' in six Member States (Belgium, Denmark, Greece, Ireland, Luxembourg, and Austria), as well as in Norway. From 2005 onwards, EU-SILC covered the then EU-25 Member States plus Norway and Iceland. Bulgaria, Romania, Switzerland and Turkey launched EU-SILC in 2007.

Context

At the Laeken European Council in December 2001, European heads of state and government endorsed a first set of common statistical indicators of social exclusion and poverty that are subject to a continuing process of refinement by the Indicators Sub-group (ISG) of the Social Protection Committee (SPC). These indicators are an essential element in the open method of coordination to monitor the progress of Member States in the fight against poverty and social exclusion.

To provide underlying data for indicators, the EU's statistics on income and living conditions instrument, EU-SILC, was implemented. The EU-SILC, organized under a Framework Regulation 1177/2003, is now the reference source for statistics on income and living conditions and for common indicators for social inclusion in particular.

Further Eurostat information

Publications

Main tables

Income and living conditions
Income distribution and monetary poverty
At-risk-of-poverty rate after social transfers by gender
At-risk-of-poverty rate after social transfers by age group
At-risk-of-poverty rate after social transfers by household type
At-risk-of poverty rate for persons aged 65 years and over
In work at-risk-of-poverty rate after social transfers
At-risk-of-poverty-rate, by highest level of education attained
At-risk-of-poverty rate before social transfers by gender
Relative median at-risk-of-poverty gap
At-persistent-risk-of-poverty rate by gender
Inequality of income distribution

Database

Income and living conditions
Main indicators
Overarching indicators
Social inclusion indicators
Pensions indicators

Dedicated section

Other information

External Links

OECD statistics on economic performance and social progress

See also

Notes

  1. ↑ Source: SILC 2007, income data 2006 (except for UK, income year 2007 and for IE moving income reference period 2006-2007); national household budget surveys 2007, income data 2007, for BG and RO.
  2. ↑ Source: SILC 2007 for all countries except BG and RO (national household budget surveys).
  3. ↑ Source: EU-SILC 2007, no data for Bulgaria.
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