Understanding Absolute Poverty in Portugal
The report titled “Who Can Afford Essential Expenses? An Analysis of Absolute Poverty in Portugal” reveals some concerning statistics regarding poverty in the country. It highlights that unemployed individuals (25%) and families with children (12.2%) are among the groups at the highest risk of experiencing absolute poverty. In 2022, the absolute poverty risk rate ranged from 8.5% to 12.6%, which is notably lower than the relative poverty risk rate of 16.4%. Furthermore, the report indicates that absolute poverty is more prevalent in urban areas (8.8%) compared to rural regions (6.9%).
Regional Disparities in Poverty Risk
The analysis, published by the “la Caixa” Foundation and BPI and conducted by the Nova SBE team, emphasizes that the risk of absolute poverty is lower than that of relative poverty across all regions, with one exception: the Lisbon Metropolitan Area. This anomaly is attributed to the high cost of living, particularly in terms of housing. The autonomous regions of the Azores and Madeira face the highest risks of absolute poverty, with rates of 22.1% and 15%, respectively. The report notes that these disparities are influenced by the distribution of families with children and non-monetary income sources, such as self-consumption and self-rentals, which vary significantly across different regions.
Analyzing Essential Expenses
Utilizing microdata from the 2022 Household Expenditure Survey and adapting Orshansky’s methods, the study examines the cost of a suitable food basket based on the age of each household member, following the guidelines from the Directorate-General of Health (DGS). It takes into account essential expenses such as housing, water, energy, and food. According to the Orshansky method, the analysis led by Professor Susana Peralta reveals that three years ago, the absolute poverty risk rate in Portugal was 12.6%, affecting approximately 1.3 million people—3.8 percentage points lower than the official relative poverty risk rate.
Impact on Families and Employment
The report highlights that the greatest risk of absolute poverty is found among households with children (21.2%) and large families (49.2%). Additionally, it states that around 900,000 workers, or 8.9% of the population, live in absolute poverty, with higher prevalence among the unemployed (31.8%) and individuals on temporary contracts (18.4%).
Extreme Absolute Poverty and Its Impact on Children
Regarding the risk of extreme absolute poverty, the interim report “Portugal, Social Balance 2024” indicates that approximately 100,000 people live in households lacking the necessary income to afford a basic diet, which accounts for nearly 1% of the population. Children and foreigners are the most affected groups, with extreme poverty rates of 1.9% and 1.3%, respectively. The report emphasizes that around 37,000 children live in households with incomes below what is required for an essential diet.
Final Observations
The document further notes that approximately 3.5% of unemployed individuals, nearly 20,000 people, do not have the resources to afford a proper diet. Large families exhibit the highest prevalence of extreme absolute poverty at 4%. The Autonomous Region of the Azores has the highest rate of extreme absolute poverty risk at 1.9%, followed closely by the Lisbon Metropolitan Area at 1.4%. This suggests a concentration of families with very low incomes in these regions.
In conclusion, the findings underscore the urgent need for targeted policies to address the pressing issues of poverty in Portugal, particularly among vulnerable populations.