Czech income poverty rates second lowest in EU, Eurostat data shows

Photo: Andrew Khoroshavin, Pixabay / CC0

The latest Eurostat data show that income poverty rates in the Czech Republic are the second lowest in the European Union, with 3.4 percent of working people in the country threatened by poverty compared to the EU average where the rate lies at around one in ten.

Photo: Andrew Khoroshavin,  Pixabay / CC0
The risk of a Czech worker falling into poverty is lower by more than a half compared to those employed in Germany, according to the most recent Eurostat data for 2018.

In fact, only Finland has a lower income poverty rate in the EU and Eurostat statistics for the same year show that the Czech Republic also had the lowest percentage rate of people at risk of poverty and social exclusion, at 12.2 percent.

However, this does not necessarily mean that the grass is greener in Czechia.

The statistic mainly describes how many people do not reach the standard of living of the country, sociologist Daniel Prokop told Czech Radio’s Radiožurnál, using the example of Luxembourg - Europe’s highest GDP per capita state.

“In some sort of absolute value of what people can afford in that country, the median in Luxembourg is twice as high as in the Czech Republic. Therefore, the poverty line is twice as high, making it easier for low-income workers to fall below it.

“However, low-income workers still do much better than low-income workers in the Czech Republic.”

For comparison, Eurostat data show that the Czech minimum wage was EUR 575 a month in the Czech Republic in 2018, just over a third of the size that it is in neighbouring Germany.

Those threatened the most by poverty in the Czech Republic are single mothers. Meanwhile, in the EU as a whole, men come out as more at threat of income poverty than women.

This difference is mainly due to a combination of two factors, Mr Prokop says.

“In the Czech Republic unemployment is low and women’s salaries are 22 percent lower on average than those of men. We are a country with one the largest pay gaps between men and women.

“In our country women are heavily penalized for maternity leave and when they return to work they have significantly lower salaries up to the age of 50.”

The second group particularly at risk of poverty are pensioners. Women, who live on average six years longer than men, can face a steep rise in their expenses after the death of their spouse.

The European Commission has also pointed to the fact that regional differences in the country are rising, with Prague and Brno set apart from the countryside, where productivity and innovation are low while debt is high.

The overall number of people at the risk of poverty declined in the European Union by two percent over the past ten years for which we have statistics. In 2018 the total number of the EU population threatened by poverty or social exclusion lay at 21.7 percent, with 1,264 living in the Czech Republic.