According to Statistics Estonia, 20.2% of Estonia’s population lived at risk of poverty and 2.7% in absolute poverty in 2023; compared with 2022, the share of people living at risk of poverty decreased by 2.3 percentage points and the share of those living in absolute poverty by 0.8 percentage points.
The share of people living in self-perceived deprivation was up by 1.5 percentage points in 2024.
Epp Remmelg, a leading analyst at Statistics Estonia, the country’s official statistics agency, said that the at-risk-of-poverty rate reflects income inequality in a country.
“In 2023, close to 274,800 people lived at risk of poverty – nearly 29,000 fewer than in 2022. Their net monthly income, taking into account household composition, ie the equivalised disposable income, was less than €807,” Remmelg said.
Income grew mainly due to increases in child benefits and pensions
The analyst noted that, over the years, the at-risk-of-poverty rate has been highest among the elderly living alone and lone parent households.
“However, we see that in 2023, the at-risk-of-poverty rate decreased the most among these households, as well as among households with three or more children,” she added.
Of people aged 65 and over living alone, 71% were at risk of poverty, down by eight percentage points from the year before.
“30.5% of lone parent households lived at risk of poverty, which is 4.3 percentage points lower than a year earlier,” the analyst said.
She noted that, among working-age households with no children and two-parent households, the at-risk-of-poverty rate remained the same or increased by a few percentage points.
“This can be explained by the fact that, in 2023, the equivalised disposable income rose by 8%, but with the overall increase in income, child benefits and pensions increased more in percentage terms than earned income,” she said.
The share of people living at risk of poverty varies by region
“The at-risk-of-poverty rate in Ida-Viru (35%) and Lääne-Viru (29.2%) counties is more than twice as high as in Harju (15.5%) and Rapla (14.1%) counties,” Remmelg stated, adding that the rate increased only in the regions farthest from the capital: by 3.5 percentage points in Ida-Viru County, 3.4 percentage points in Võru County and 0.4 percentage points in Saare County.
In 2023, nearly 36,400 people lived in absolute poverty – 11,300 fewer than a year earlier. “However, it is worth noting that this number is still higher than three, four or five years ago,” Remmelg pointed out.
The analyst explained that absolute poverty indicates the share of the population who are not able to meet their basic needs.
“Their net monthly income, taking into account household composition, was less than €338, ie below the estimated subsistence minimum,” Remmelg asserted.
The absolute poverty rate fell among the over-65s. It also decreased among children and young people (0–24 years), with 9,500 fewer of them living in absolute poverty in 2023 than a year earlier. The absolute poverty rate rose slightly among 25–49-year-olds, with 1,600 more of them experiencing absolute poverty than the year before.
One in four lone parent households experience deprivation
The share of people living in deprivation, ie people who cannot afford various items commonly available in the society, increased by 1.5% this year. 7.7% of the population, or nearly 104,700 people, felt deprived in 2024.
One in four (25.3%) lone parent households and around one in eight (12.8%) people aged 65 or over living alone experienced deprivation in 2024. Deprivation increased by a third (34%) in 2024 among lone parent households and rose significantly among households with three or more children and elderly couples.
According to the social ministry, it is important to first target the planned measures to where the need is greatest.
“It is still the people living alone or households with only one source of income who are most at risk of poverty. The absolute poverty rate is also higher among the unemployed. Our aim is to help the most vulnerable target groups – the elderly and lone parents – to get back on a better economic footing, both through various allowances and services,” Kati Nõlvak, the head of economic subsistence at the social ministry, said.
Allowances have increased
She noted that a number of measures have been taken in recent years to alleviate poverty and improve the livelihoods of those most in need. Last year saw the biggest pension increase in 15 years and pensioners have been guaranteed tax-free income equal to the amount of the average old-age pension. The nursing care reform, which came into effect in July last year, has made nursing homes more accessible and reduced both the burden of payment and the burden of care on loved ones.
Sickness and care benefits for parents returning from parental leave have also become fairer this year. Child and family allowances have increased, single parent’s child allowance and maintenance allowance have doubled.
“Our goal is to reduce the share of the population at risk of poverty and social exclusion to 21% by 2030, and we have set a specific target of reducing the at-risk-of-poverty and social exclusion rate for children to below 15%,” Nõlvak added.
The estimations are based on the data of the 2024 Estonian Social Survey. Altogether, 5,515 households participated in the survey. The survey collects data about yearly income, which is why the 2024 survey asked respondents about the income in 2023.
