In 2023, 20.2 percent of Estonia's population lived in relative poverty, while 2.7 percent lived in absolute poverty. Compared to 2022, the share of people in relative poverty decreased by 2.3 percentage points and the share in absolute poverty dropped by 0.8 percentage points.

Perceived deprivation, however, increased by 1.5 percentage points in 2024.

Statistics Estonia lead analyst Epp Remmelg explained that relative poverty reflects income inequality within the country. "Last year, around 274,800 people lived in relative poverty, which is nearly 29,000 fewer than in 2022. Their household-adjusted net income, or equivalized net income, was below €807 per month," she said.

Income growth based on child benefits and pensions

The analyst noted that the relative poverty rate has historically been highest among older people living alone and single-parent households.

"In 2023, however, we observed the largest decrease in relative poverty specifically among these households, as well as in households with three or more children," Remmelg said.

In 2023, 71 percent of individuals aged 65 and older who live alone experienced relative poverty, marking an 8 percentage point decrease from the previous year.

"Among single-parent households, 30.5 percent lived in relative poverty, which is 4.3 percentage points less than the previous year," the analyst explained.

Remmelg added that for households of working-age people without children and those with two parents and children, the relative poverty rate either remained stable or increased slightly. "This can be attributed to the fact that equivalized net income rose by 8 percent in 2023, but within the broader income growth, child benefits and pensions saw the highest percentage increases, rather than income from wages," she said.

Relative poverty differs by region

"The relative poverty rate is more than twice as high in Ida-Viru County (35 percent) and Lääne-Viru County (29.2 percent) compared to Harju County (15.5 percent) and Rapla County (14.1 percent)," said Remmelg.

Relative poverty increased only in Estonia's most remote areas from the capital's perspective: by 3.5 percentage points in Ida-Viru County, by 3.4 percentage points in Võru County and by 0.4 percentage points in Saare County.

Absolute poverty down among over-65-year-olds, children and youths

In 2023, around 36,400 people experienced absolute poverty, which is 11,300 fewer than the previous year.

"However, it's worth noting that this number is still higher than it was three, four or five years ago," Remmelg observed.

The analyst explained that absolute poverty indicates the portion of society unable to sustain a basic standard of living. "These individuals had an adjusted household monthly income below €338, which is lower than the estimated subsistence minimum," she said.

Absolute poverty declined among those aged 65 and older, as well as among children and young adults (ages 0-24), with 9,500 fewer people in this age group living in absolute poverty in 2023 compared to the previous year.

On the other hand, absolute poverty saw a slight increase among those aged 25-49, with 1,600 more individuals in this age group living in absolute poverty than the year before.

Every fourth single-parent households feels deprived

Perceived deprivation, which reflects the number of people unable to afford many commonly available goods and services, rose by 1.5 percent this year. In 2024, 7.7 percent of the population – around 104,700 people – felt deprived.

Among specific groups, 25.3 percent of single-parent households and about 12.8 percent of individuals aged 65 and older living alone experienced deprivation in 2024. Notably, perceived deprivation grew by 34 percent in single-parent households and also increased significantly among households with three or more children, as well as among elderly couples.

These estimates are based on data from a 2024 social survey, which included 5,515 households. The survey collects data on annual income, meaning that the 2024 survey queried income data from 2023.

The relative poverty rate indicates the proportion of individuals whose household-adjusted annual income, or equivalized net income, falls below the relative poverty threshold. This threshold is set at 60 percent of the median equivalized annual income for household members. Equivalized net income is calculated by dividing household income by the sum of consumption weights for household members.

The deprivation rate measures the proportion of people who cannot afford at least five of the following 13 essentials: 1) paying rent and utility bills; 2) keeping the home adequately warm; 3) handling unexpected expenses; 4) eating a meal with meat, fish or equivalent protein every other day; 5) taking a one-week holiday away from home; 6) owning a car; 7) replacing worn or damaged furniture; 8) replacing worn clothes with new ones; 9) having at least two pairs of well-suited shoes; 10) spending a small amount on oneself weekly; 11) participating in a paid leisure activity regularly; 12) meeting friends or relatives for food or drink at least once a month; or 13) having home internet access for personal use when needed.

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