In 2012 the proportion of people at risk of poverty or social exclusion in Iceland was the lowest in Europe. The rate in Iceland was 12.7% but 25% in the European Union. Norway had the second lowest rate among European countries followed by the Netherlands. The countries with the highest proportion of people at risk of poverty or social exclusion were Bulgaria, Rumania and Latvia. The indicator is based on three factors: household income, work participation of household members and which material goods the households can afford.
When focusing on those at risk of poverty the proportion was also lowest in Iceland or 7.9% compared to 17.1% within the European Union. The at-risk-of-poverty threshold is defined as 60% of median income in each country. Those who fall below that income threshold are considered to be at risk of poverty.
Looking at other indicators of income distribution Iceland was the country with the third most equal distribution of income in Europe. The Gini index in Iceland was 24 but 30.5 within the European Union. The Gini index was lowest in Norway, 22,6 and Slovenia, 23,7. The indicator would be 0 if everyone had the same income but 100 if all the income belonged to one person. The quintile share ratio compares the income of the 20% of the population with the highest income and the 20% with the lowest income. In Iceland the highest income quintile had 3.4 times the income of lowest income quintile. Within the EU the quintile share ratio was 5.1. Norway had the lowest quintile share ratio, 3,2, followed by Slovenia with 3,4.
In 2012 purchasing power in Iceland remained the same between years after having gone down from 2009. The trend between 2011 and 2012 is similar for all income quintiles. The purchasing power decreased most for the highest income group between 2009 and 2011.
Statistical Series
Statistics Iceland has published an issue in the Statistical Series about risk of poverty and income distribution in 2012. More details on the results can be found in the Statistical Series.
Risk of poverty and income distribution 2012 - Statistical Series
Statistics