Poverty in rural areas

A person at risk of poverty or social exclusion is a member of a low-income household or a household that has a minor input during a year or that is severely materially deprived. A person defined to be disadvantaged by at least one of the three indicators is considered to be at risk of poverty or social exclusion.

In Finland, the percentage of the people at poverty risk has ranged from 14 to 18 per cent over the past ten years. In 2019, the risk was 15.9 per cent and 14.3 per cent in 2020. The share was the lowest (10.4 per cent) in rural areas close to urban areas, while it was 14 per cent in urban areas in 2020. The poverty risk is the highest in thinly populated rural areas where it was 17.4 per cent.

According to the Europe 2020 strategy, the number of people living at risk of poverty or social exclusion in the EU should decrease from 120 million in 2008 to 100 million by 2020. The financial crisis has made this goal less feasible. In Finland, problems related to livelihood are rare compared with the rest of Europe. Furthermore, the financial crisis is not clearly reflected in the Finnish poverty rate. In certain EU states, the poverty rate is as high as 50 per cent.

The AROPE (At Risk of Poverty or Social Exclusion) indicator is part of the system to monitor the fulfilment of the goals of the Europe 2020 strategy. A person is at risk of poverty or social exclusion if at least one of the following factors is realised in their household: low income, underemployment or severe material deprivation.

A person has a low income if they live in a household where income per consumption unit is less than 60 per cent of the national median income. All people under 60 years of age whose household produces an input of less than 20 per cent of the potential input of that household during the survey year are considered to be underemployed. “Potential input” refers to the total theoretical working months of household members of 18–59 years of age per year (excluding non-independent individuals of 18–24 years).

People whose household is deprived by at least four out of nine indicators are considered to be severely materially deprived. These indicators are inability to pay rent, mortgage or utility bills, difficulties in covering unexpected expenses, inability to afford a telephone, washing machine, TV set, car, a protein-rich meal every other day, one-week holiday once a year outside the home or to keep their home adequately warm.

This information is based on sample-based EU statistics on income and living conditions (EU-SILC). Statistics Finland calculates the poverty rate.

This indicator serves to evaluate the impact of actions taken under the Rural Development Programme on the employment rate, vitality and the development of service availability in rural areas compared with overall development in society.

This indicator is one of the CAP impact indicators.

The indicator will next be updated in autumn 2023.