One million more people faced poverty in Italy in 2020?

According to preliminary results from Istat, the Italian national statistical institute, there are 1 million more poor people in Italy in 2020 compared to 2019. It would be a 22% year-on-year increase and the highest figure since 2005 and the beginning of the analysis.

The results account for 335 000 more families who lived below the poverty line than last year, for a total of 5.6 million individuals.It represents more than 9% of the 60 million people living in Italy.

The report conclusions are drawn from 25,000 household expenditures registered for 14 days. In order to consider the Italian’s cost of life, the data are then compared against a minimum budget that would allow for buying goods and services that are considered essentials for a minimally acceptable level of life and social inclusion.

The methodology is different from the World Bank’s international extreme poverty definition of less than $5.5 a day for upper-middle-income countries.

Still, 3.1% of the population in Italy lived below the extreme poverty line in 2017 according to the World Bank data. And last October, the organization expected that Covid-19 would add 150 million people into extreme poverty worldwide.

According to Istat, a single adult under 60 years old, living in a northern city like Turin or Milan, needed €840 a month for staying afloat in 2019.

A family of 2 parents with 2 children between 11 and 17 in a small southern city needed €1,304 each month to cover minimal needs.

Record decline of household consumption

The preliminary results are given in the context of a record drop in consumption, around -9% in 2020, similar to the Italian recession rate.

The year has also been marked with an economic crisis pressuring employment, restricted opportunities to spend, and growing concerns about the future leading to saving money when possible. The Italian state also took various measures to sustain a vital purchasing power like with the “reddito di emergenza”, or the emergency pay.

The report, based on a consumption methodology, may be imperfect given an extraordinary year, it still gives important insights.

Poverty ratio in Italy
Ratio of poor families and individuals over the years in Italy. Istat, Indagine sulle spese per consumi delle famiglie

On average, Italian families spent €2,328 a month last year, €232 less than during the months of 2019. Food and housing expenditures remained stable while the rest decreased by 19%.

This level of poverty in the country hasn’t been recorded since at least 2005, when the methodology started to be put in place.

The north of Italy, usually home to richer people, saw a larger increase in poverty compared to the south.

Working and large families highly impacted by the crisis

The ratio of poor families grew the most where at least one family member had a job, with 7.3% of them now considered as poor. It shows that worse economic conditions particularly affected those with an income.

Almost 20% of the families with someone looking for a job are poor, but the ratio remained stable.

One in 5 families with 5 members or more (e.g. 2 parents and 3 children) are under the Italian poverty line. Single-parent families are also some of the most impacted by worsening conditions.

The largest budget items: food and accommodation

In general, food and housing expenditures account for 58% of the monthly budget, growing from 53% in 2019. But for poor families, these 2 expenses account for 77% of their budget now.

The final version of the study will come out in June 2021.

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