More than one fifth of Estonian population at risk of poverty in 2018

Those aged 65 and over remain significantly more at risk of poverty. Source: Statistics Estonia

According to information released by Statistics Estonia, 21.7 percent of the Estonian population lived at risk of poverty and 2.4 percent lived in absolute poverty in 2018. Compared with 2017, the share of people at risk of poverty decreased by 0.2 percentage points, while the share of those living in absolute poverty was down by 0.3 percentage points.

In 2018, a person was considered to be at risk of poverty if their equivalized monthly disposable income totaled less than €569 and in absolute poverty if it totaled less than €215.

The at risk of poverty rate decreased for single-person households, i.e. people living alone, as well as among single parents. The gap between the richest and poorest quintiles of the population remained unchanged on year. By age group, the gap is smallest among older persons, i.e. people aged 65 and older, although in the last decade, it was widened slightly each year.

The at risk of poverty rate anchored at a fixed moment in time, i.e. the share of people with an equivalized yearly disposable income lower than the at risk of poverty threshold three years ago adjusted for inflation, increased from 11 percent in 2017 to 12.1 percent last year.

Social transfers, i.e. state benefits and pensions, helped prevent individuals from falling into poverty. Excluding these from income, 39.1 percent of Estonia's population would have been considered at risk of poverty and 22.7 percent would have been in absolute poverty.

Compared with 2017, the at risk of poverty rate remained steady at 20.9 percent among young people aged 16-24, but increased among children. Among children under 18, the at risk of poverty rate increased 1.9 percentage points on year to 17.1 percent in 2018. At the same time, the absolute poverty rate of children fell from 2.5 percent in 2017 to 1.6 percent last year. There has also been a decrease in the share of older people living at risk of poverty — the rate among persons aged 65 and older fell from 46.4 percent in 2017 to 43.1 percent in 2018.

This year, a total of 7.6 percent of the Estonian population lived in deprivation. The deprivation rate was highest among older persons, i.e. people aged 65 and older, at 10.4 percent and lowest among those aged 18-24 at 5.3 percent.

At risk of poverty rate, deprivation rate

The at risk of poverty rate is the share of persons with equivalized yearly disposable income lower than the at risk of poverty threshold. The at risk of poverty threshold is equal to 60 percent of the median equivalized yearly disposable income of household members. Equivalized disposable income is total household income divided by the sum of equivalence scales of all household members.

The deprivation rate is the share of persons who cannot afford at least 5 of the following 13 expenditures: 1) to pay rent or utility bills; 2) to keep their home adequately warm; 3) to face unexpected expenses, 4) to eat meat, fish or protein equivalent every other day; 5) a one-week vacation away from home; 6) a car; 7) to replace furniture when worn out or damaged; 8) to replace worn-out clothes with new ones; 9) to have at least two pairs of climate-appropriate outdoor shoes in good condition; 10) to spend a small amount of money each week on oneself; 11) to participate regularly in a leisure activity that costs money; 12) to get together with friends or family for a drink or meal at least once a month; or 13) to have an internet connection at home for personal use when needed.

In the Estonian Social Survey, those aged 16 and over are asked about items 8-13. Thus, when calculating deprivation for these items for children, at least half of household members (16 and over) should be deprived with regard to these items.  


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Editor: Aili Vahtla

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