Measuring Inequality in Ireland and the EU
In Ireland data on income and poverty and inequality for different household types is produced by the Central Statistics Office in the Survey on Income and Living Conditions
(SILC). To be able to compare the data with that of other countries the data produced for national purposes is slightly adapted by the CSO for the EU’s data agency Eurostat
. For comparison reasons the data shown on this page for Ireland is that adapted for Eurostat.
One measurement which is produced on equality is the Gini coefficient. This is the most commonly used measure of income inequality. The coefficient varies between 0, which reflects complete equality and 100, which indicates complete inequality (one person has all the income or consumption, all others have none). The Gini coefficient
for Ireland in 2017 was 30.6, an increase from 29.6 in 2016. The Gini Coefficient in the EU in 2017 was 30.7. Across the EU it ranged from 40.2 in Bulgaria, to 24.5 in Czechia, and 26.0 in Belgium.
Another helpful indicator which also shows the levels of inequality in a country is the ‘inequality of income distribution – income quintile share ratio’. The S80/S20 ratio is the ratio of the total income received by the 20% of the country’s population with the highest income to that received by the 20% of the country’s population with the lowest income. The higher the ratio, the greater the inequality. The S80/S20 2010 ratio for Ireland in Eurostat’s
report was 4.6 in 2017, up from 4.2 in 2009 and 4.4 in 2016. The average for EU in 2017 was 5.1. The highest rate being 7.3 in Lithuania with the lowest in Czech Republic and Slovenia at 3.4 followed closely by Slovakia and Finland on 3.5, with Belgium on and Norway on 3.8.
At-Risk of Poverty Rate
People or households are considered to be at risk of poverty when their income is less than a particular threshold. In the EU, the threshold has been set at 60% of the median income (mid-point in the scale of the highest to the lowest of all incomes). The latest Eurostat statistics
shows that In 2017, there were 112.8 million people in the EU-28 who lived in households at risk of poverty or social exclusion equivalent to 22.4 % of of the entire EU population, with 22.7% at-risk in Ireland according to their measurement. The highest levels are to be found in Bulgaria at 38.9% and Romanian with 35.7%. The lowest levels were in Slovakia at 16.3%, Finland 15.7%, and Czech republic where 12.2 % of population were at-risk of poverty. Eurostat also has a useful tool which allows people to visualise the at-risk of poverty rate
for each EU country, which is updated in honor of the International day of the Eradication of Poverty which takes place on October 17th every year.
Since 2015, TASC, the Think-tank for Action non Social Change has produced a yearly report on inequality in Ireland called Cherishing All Equally: Economic Inequality in Ireland
looking at a wide range of issues. The 2016 report also includes in-depth themed sections regarding the impact of economic inequality on gender and children.
Wealth and Inequality
Wealth, and the distribution of wealth, are topics which have been the subject of very little discussion over time, but the available figures show that gathering statistics on the distribution of wealth is extremely helpful in highlighting how equal or unequal a society is. Even during the “Celtic Tiger” years, the number of people experiencing poverty remained persistent. At the same time, the number of millionaires increased steadily and was only momentarily halted due to the current financial crisis and is now on the increase again. EAPN
has produced a series of documents looking at the issue of wealth and income inequality.
- Inequality in the EU (2014) focuses primarily on the nature and extent of poverty, its causes and its links to inequality. It explains how poverty is understood and measured currently in the EU, and highlights some of the shortcomings of these approaches.
- Explainer on Wealth, Inequalities and Social Polarisation in the EU (2011) explains what wealth is and how social polarization is currently growing in the EU and worldwide, providing a whole range of statistics on these issues.
Household Finance and Consumption Survey 2013
The Central Statistics Office (CSO) in Ireland published the Household Finance and Consumption Survey 2013
which shows how wealth is distributed across different family types and different income levels. It shows that after excluding debt those with the top 20% of incomes have almost 40% of the wealth while the bottom 20% have 11.4%. Among the other findings the survey highlights is the particularly difficult situation for one parent families in Ireland who have very low levels of savings, high levels of debt and that while one parent families make up 4.4% of all families in the country (covered in the survey) they only account for 0.7% of the total net wealth. This reinforces the information on high poverty levels for one-parent families as highlighted in the Survey on Income and Living conditions 2017. A follow up to the Household Finance and Consumption Survey 2013 has not yet been published.