Facts: Material and social poverty
The indicator of material and social poverty complements the previous indicator of material poverty, where the focus was on consumer goods and whether one can afford certain necessary expenses. By including social activities, the social dimension of poverty is also included.
A person in material and social poverty cannot afford at least five of these thirteen items:
Pay unexpected expenses
Take one week’s vacation per year
Eat a meal of meat, chicken or fish (or an equivalent vegetarian option) every other day
Have adequate heating of the home
Have access to a car
Pay debts (mortgage or rent, bills, installment purchase or loan repayment)
Replace worn furniture
Replace worn clothes
Own two pairs of shoes
Meet friends and family for coffee, a beer or dinner at least once a month
Dedicate time regularly to some leisure or recreational activity
Each week spend a small amount of money on yourself
Have access to the internet
Source: Statistics Sweden
There is no doubt that poverty will increase in Sweden during the winter, according to Carina Mood, professor of sociology at Stockholm University and research leader at the Institute for Future Studies.
But how can we see if it increases? In Sweden, Statistics Norway (SCB) produces statistics on poverty, or the risk of it, and then uses different measures. Two common measures are based on income.
The first is the relative income measure, also called low economic standard, an EU measure that measures how many people have an income below 60 percent of the median income in society. If one starts from this measure, however, it is not certain that poverty will increase, but it may instead decrease.
— It is very likely that the real median income will go down because more people can afford less. Then you also move the limit downwards, says Carina Mood.
Should be observant
However, the relative income measure does not have to be misleading, according to Johan Lindberg, who is an investigator at Statistics Norway. But if we were to enter a severe recession, one should be observant.
— Because then incomes can decrease in society when more people become unemployed and start going to social security, which could mean that the median income goes down and that fewer people are possibly classified as poor.
The second is the so-called absolute poverty measure, or low income standard, and describes how well households’ income is sufficient to pay necessary overheads.
— Here, instead, consumption is measured and what it costs to consume different goods. Then you could see a directly greater impact in the situation we are in now, says Johan Lindberg.
Get with cash margin
Another measure used in Sweden is called severe material and social poverty, and measures the difficulties that households have in getting their finances together. The statistics are based on collected data in the form of survey responses from households.
— To be in material poverty, for example, you cannot afford to eat cooked food every day, heat the home or replace worn-out shoes. Financial distress can be about having difficulty paying one’s bills or not being able to have a cash margin should something unforeseen occur, says Carina Mood.
Cash margin means not being able to raise SEK 13,000 in a month if something unforeseen were to happen, such as the washing machine or fridge breaking down. Or to receive an expensive electricity bill.
According to the latest figures from last year, 18 percent of the population did not have such a cash margin. The proportion who lived in material poverty, on the other hand, was significantly lower, closer to two percent.
“A margin of SEK 13,000 is quite a large one, but there are still an alarming number of people who lack such a margin,” says Carina Mood.
May take a long time
As a result of the price increases, as I said, poverty will most likely increase, but it may take a long time until we see it in black and white. Statistics Sweden’s statistics for low economic standards and the absolute poverty measure may not come until 2024, when Statistics Sweden’s starting point is income declarations from the Swedish Tax Agency. We will have to wait even longer to see how electricity prices will fare at the beginning of next year.
The lag in statistics is a big problem, according to Carina Mood.
— For those who want to remedy the problem, i.e. politicians and authorities, it is completely pointless to know what it looked like in 2022 before 2024. If you don’t know who is having a hard time and how hard they have it, it can happen that they the most vocal get help, instead of those who need it the most.
This year’s figures on severe material and social poverty, on the other hand, do not take as long, but will probably be published this spring. Here, Johan Lindberg believes that we may see an effect as early as next year.
— This shows the expenses that households have, such as amortization of debts and heating the home. So we can certainly see a swing already in the next figures, he says.