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Although it was a pandemic year, with the economy declining and unemployment rising, the risk of being poor has decreased in 2020, while inequality has also decreased.
INSTAT reported that in 2020, 621,504 individuals living below the risk threshold for being poor were estimated, compared to 659,138 individuals estimated in 2019. This indicates that the overall level of disposable household income has increased and the number of individuals at risk of being poor decreased by about 5.7%.
INSTAT has published the results of the 2020 Income and Living Standards Survey (AANJ), which measures the standard of living, relative poverty and material deprivation in Albanian households. The risk indicator for being poor in Albania in 2020 is 21.8%, experiencing a decrease of 1.2 percentage points compared to 2019, 1.6 percentage points, compared to 2018 and 1.9 percentage points, compared to 2017.
Compared to the region, Albania has the highest risk indicator for being poor, while in Europe it leaves behind three countries, Turkey, Romania and Bulgaria. According to INSTAT, Poverty Indicators in the Income and Living Survey are based on the concept of relative poverty, which takes into account disposable household income, number of household members (household size) and income distribution among population groups.
The risk limit for being poor for a person in 2020 is estimated at 186,242 ALL, compared to 170,785 ALL in 2019 and 160,742 ALL in 2018. The deepened material deprivation rate shows the percentage of individuals who live in families who can not afford at least 4 of the 9 categories of material deprivation This indicator is estimated at 34.7% in 2020, compared to 37.1% estimated in 2019, marking a decrease of 2.4 percentage points.
Family employment intensity refers to the number of months that all family individuals have worked versus the total number of months they should theoretically have to work during the year (12 months). Families which are considered to have very low intensity in employment are defined in the 20% limit. Individuals aged 18-59, who live in families with very low employment intensity, in 2020 according to estimates account for 11.6%, compared to 12.4% in 2019, reflecting a decrease of 0.8 percentage points.
Risk of being poor or social exclusion refers to individuals who are at risk of being poor, or deeply materially deprived, or living in families with very low employment intensity. In 2020, this indicator is estimated at 43.4%, compared to 46.2% estimated in 2019.
Social benefits, such as old-age and family pensions, included in disposable family income, reduce the risk of being poor. If the level of income did not include all types of social benefits, the risk of being poor in 2020 is estimated at 37.9%, compared to 24.8% which is estimated if included in the level of income social benefits only from old-age and family pensions.
The risk of being poor by age group and gender was analyzed for three age groups. The downward trend is observed in all three age groups, but a greater decline have the age groups 0-17 years and 18-64 years, where the risk of being poor in 2020, compared to 2019, has decreased respectively by 1 , 3 and 1.2 percentage points. The age group 65 and above has decreased by 0.1 percentage points, compared to 2019.
The risk of being poor by employment status, for employees aged 18 and over, in 2020 has decreased by 1.9 percentage points, compared to 2019. The risk of being poor among unemployed individuals has suffered a decrease of 1.4 percentage points, while among pensioners it decreased by 0.1 percentage points.
The percentage of individuals at risk of being poor by family type, in 2020, in families without dependent children, is estimated to be lower, compared to families with dependent children, respectively 13.0% and 26.0 % of individuals. A year ago these percentages were 14.2% and 27.2% respectively.
Ulet inequality
The level of inequality according to income distribution is measured through the Gini coefficient and the income quintile ratio (S80 / S20). The Gini coefficient measures the inequality in income distribution, where the value 0% expresses full equality and all individuals have the same income, while a Gini coefficient equal to 100% expresses the complete inequality where only one person has all income . In 2020, Guinea is estimated at 33.2%, down 1.1 percentage points from 2019.
The S80 / S20 quintile ratio is an indicator that measures income inequality through the ratio of the highest level of equivalent disposable income (last quintile) to the lowest level of equivalent disposable income (quintile of first). It presents the ratio between the total equivalent income of 20% of the higher income population and of 20% of the lower income population.
In 2020 the S80 / S20 ratio is estimated at 5.9 compared to the 6.4 ratio that was estimated in 2019. For the population aged 65 and over, this ratio in 2020 is estimated at 4.0 versus 4.1 that was in 2019. For persons under 65 this ratio was estimated at 6.2 in 2020, compared to the ratio of 6.8 that was in 2019. Percentage of individuals at risk of being poor, in cases where the risk limit for being poor poor is defined as 50.0% of median equivalent per capita income is estimated at 14.4% in 2020, compared to 16.2% estimated in 2019. In 2020, the average monthly disposable income per capita / equivalent have increased by 8.3%, compared to 2019.
Comparison with other states
Comparison of the risk of being poor for 2020, between Albania and other countries of the Region and the European Union show that: The highest value of relative poverty is recorded in Bulgaria (23.8%), Romania (23.4% ), Turkey (23.0%), followed by Albania (21.8%). The lowest poverty rates are recorded in the Czech Republic (9.5%), Slovakia (11.4%), Denmark (12.1%) and Finland (12.2%). The average of European Union countries (27 countries) is 17.1 %./Monitor
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