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Data from April 2009, most recent data: Further Eurostat information, Main tables and Database.

Social inclusion has long been in the centre of European policies. It aims at the significant reduction in the number of persons at risk of poverty and social exclusion by 2010. In order to create a socially inclusive society, the improvement in the quality of life of citizens is regarded as a precondition for lasting individual well-being. However, poverty and social exclusion are multidimentional concepts and therefore, they are challenging to measure. For this reason, a set of both monetary and non-monetary indicators has been adopted such as, for example, at-risk-of-poverty rate, at-risk-of-poverty threshold, income quintile share ratio and material deprivation rate. Nonetheless, due to the complexity of the concepts, there are other equally relevant aspects which should be considered, namely, access to employment, education and training, health, or housing.

Main statistical findings

At-risk-of-poverty rate and At-risk-of-poverty threshold in the EU

Figure 1. At-risk-of-poverty rate and At-risk-poverty threshold in the EU (%), 2007 [1]

In 2007, in EU-27, approximately 79 million people (16%) lived below the poverty threshold, a situation likely to hamper their capacity to fully participate in society. 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 in order 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 of high relevance.

However, the choice to set the poverty threshold at 60% of the national median equivalised disposable income is conventional. In each country, it represents the level of income that is considered necessary to lead an adequate life. When taking into account the differences in the cost of living (values expressed in purchasing power standards), the poverty threshold for a single-person household varies from less than PPS 4000 in Bulgaria Latvia, Poland, Lithuania and Hungary up to more than PPS 10000 in eight Member States. This suggests that the standard of living of the poor is 3 to 4 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]

An other interesting facet of social inclusion is the distribution of income illustrated by the S80/S20 ratio in order to indicate the relative position of the bottom income quintile with regard to that of the top income quintile. In 2007 the value of the ratio was of 4.8 for the EU-27, which means that the wealthiest quintile had nearly 5 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 UK and low in all Nordic countries, the situation is diverse among the new Member States with high level of the ratio in the 3 Baltic countries plus Romania and Poland, as opposed to all the other New Member countries.

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 terms of inability to afford some items which are considered desirable or even necessary by most people to have an adequate life. The indicator makes an essential distinction between the persons who cannot afford a certain good or service, and those who do not have this good or service for any other reason, e.g. because they do not want or do not need it.

In 2007 17% of the EU-27 population was to be considered materially deprived, with great discrepancies between Member States, mainly the old and new Member States. On one hand only 3% of the population was deprived in Luxembourg and 10% or less in all Nordic countries, the Netherlands, Austria, Spain, Ireland and the United Kingdom. On the other hand, the Material deprivation rate was beyond 50% in Romania, 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 have launched EU-SILC in 2007.

Context

At the Laeken European Council in December 2001, 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 (OMC) to monitor the progress of Member States in the fight against poverty and social exclusion.

In order to provide underlying data for indicators, the EU-SILC (Community Statistics on Income and Living Conditions) instrument was implemented. The EU-SILC, organised under a Framework Regulation of the European Parliament and the Council (N°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

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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