Quality of life indicators - economic security and physical safety - Statistics Explained

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Quality of life indicators - economic security and physical safety


Data from July 2020

Planned article update: August 2021

Highlights

In 2018, almost one third of the population (32.2 %) in the EU reported being unable to cope with unexpected financial expenses.

Across the EU, in 2018, about one in nine persons (11.5 %) perceived there had been crime, violence or vandalism in the area where they lived.

Share of the population unable to face unexpected financial expenses, EU-27, 2008 and 2018

This article is part of a Eurostat online publication that focuses on Quality of life indicators, providing recent statistics for the European Union (EU). The publication presents a detailed analysis of various dimensions that can form the basis for a more in-depth analysis of the quality of life, complementing gross domestic product (GDP) which has traditionally been used to provide a general overview of economic and social developments.

The focus of this article is the sixth dimension — economic security and physical safety — of the nine quality of life indicators dimensions that form part of a framework endorsed by an expert group on quality of life indicators. A variety of risks may threaten the material conditions and safety of individuals and households. Examples at an individual level may include losing one’s job, health problems, or ageing, while events at a national or even global level may also have an impact, such as the global financial and economic crisis which resulted in a sudden deterioration of economic conditions and a fall in living standards for a wide cross-section of the European population. Alongside these economic aspects that may affect an individual’s quality of life, there are many non-economic risks, such as violence and/or crime, which may endanger an individual’s physical safety. Even in cases where these risks do not materialise, the subjective perception of such a threat may lead to feelings of insecurity which can effectively undermine an individual’s quality of life.

Full article

General overview

There are many risks that may unexpectedly and adversely affect an individual’s or a household’s material security. For the purpose of this article, these risks are split into two categories: economic security and physical safety. The former is analysed by presenting statistics which seek to measure a range of different situations in which people may find themselves, such as being unable to face unexpected financial expenses, or being in arrears for mortgage, rent, utility bills or hire purchase payments. The second half of the article deals with physical safety, and is based on an analysis of crime statistics, as well as subjective information on the share of the population that perceives crime, violence or vandalism in the area where they live.

Economic security

The concept of economic security is not limited to the existence and magnitude of risks that are related to material living conditions, the probability of them occurring, or their financial implications/severity. In a narrow sense, economic security may be defined in relation to an individual’s ability to make use of financial resources if these are urgently required. The concept of economic security may be extended to encompass people’s overall vulnerability or resilience to such adverse situations and the existence of support mechanisms — human and social resources — which provide a safety net for individuals in need, for example, social security systems or assistance provided by family and/or friends.

This first section is therefore based on a combination of subjective and objective information, with economic security being analysed not only in relation to disposable income or available wealth (for example, the share of the population with arrears on mortgage and rental payments), but also through subjective information which may help provide a more accurate picture of a person’s or a household’s level of economic security and their vulnerability to economic risk (for example, self-reported ability to cope with unexpected financial expenses).

In 2018, almost one in every three people (32.2 %) in the EU-27 reported being unable to cope with unexpected financial expenses (see Figure 1). At the top of the global financial and economic crisis, the share of the population that was unable to face unexpected financial expenses had been 37.1 % in 2010, with this share gradually rising to a peak of 40.4 % by 2012, before a period of six years of consecutive decreases.

On the basis of this measure, economic insecurity was generally more widespread in two of the Baltic Member States, several eastern Member States, as well as two southern Member States. In 2018, more than half of the population reported being unable to pay for unexpected financial expenses in three of the European Union (EU) Member States: Latvia (55.3 %), Croatia (52.9 %) and Greece (50.4 %). At the other end of the range, less than one quarter of the population faced such difficulties in Belgium, Czechia, the Netherlands, Sweden, Austria, Luxembourg and Malta (where the lowest share was recorded, at 13.9 %).

Across the EU, the share of the population that was unable to face unexpected financial expenses dropped by 4.9 percentage points between 2010 and 2018. An increase was observed in 12 of the EU Member States, with this share rising at the fastest pace in Greece (up 23.8 percentage points) and Estonia (15.0 percentage points); these two were also the only countries with double-digit increases. Among the Member States where a lower share of the population faced such risks in 2018 than in 2008, the biggest reduction was recorded in Hungary, where the share of the population unable to face unexpected financial expenses fell by 34.3 percentage points; there were also double-digit falls recorded in Bulgaria, Poland, Malta, Czechia and Slovenia.

Figure 1: Share of the population unable to face unexpected financial expenses, 2008 and 2018
(% of total population)
Source: Eurostat (ilc_mdes04)

Economically vulnerable groups

In its broadest sense, the notion of economic vulnerability refers to situations in which individuals, households or subgroups of the population are exposed to risks as a result of having insufficient resources to cope with the consequences of unexpected situations. This indicator may be used to identify those groups in society that are unable to withstand the potential damage that may be caused by an adverse (financial) shock. As may be expected, a higher proportion of the population that was living below (rather than above) the poverty threshold was unable to face unexpected financial expenses. In 2018, almost two thirds (65.4 %) of the EU-27 population that was living below the poverty threshold faced such risks, while the corresponding share for people living above the poverty threshold was less than one third (25.5 %) — see Figure 2.

As already shown, overall economic vulnerability is generally less prevalent in western and Nordic Member States. However, it is interesting to note that the risk of economic vulnerability in many of these countries was often considerably higher among people living below the poverty threshold than it was for people living above the poverty threshold. For example, in Malta, the share of the population that was unable to face unexpected financial expenses was 4.3 times as high among people living below the poverty threshold (38.5 %) as it was among people living above the threshold (8.9 %), while in Belgium and Sweden the same ratio was only slightly lower, at 4.1 and 4.0, respectively; ratios of at least 3.0 were also recorded in the Netherlands, Czechia, Austria, Luxembourg and Germany.

Figure 2: Share of the population unable to face unexpected financial expenses, by income situation, 2018
(%)
Source: Eurostat (ilc_mdes04)

Unpaid debts and arrears

In 2018, mortgage or rental arrears were most prevalent in Greece, where 11.2 % of the total population had outstanding debts of this kind (see Figure 3). This was considerably higher than in any of the other EU Member States, as the next highest proportion was recorded in Cyprus (7.1 %), followed by France (5.2 %) and Ireland (5.0%). The share of the population reporting arrears on mortgage or rental payments was below 5.0 % in the remaining EU Member States, falling to less than 2.0 % in eight of them and reaching a low of 0.4 % in Romania. These low levels may be related, at least in part, to the small shares of the overall population that had a mortgage or were renting at market prices, thereby limiting the proportion of people who could be in arrears for mortgage or rental payments. For example, in Romania, those people who were homeowners with a mortgage or tenants with a market rent accounted for just 2.3 % of the total population in 2018, compared with an EU-27 average of 45.7 % (click here for a complete data set covering all EU Member States).

The percentage of the population that were behind with their mortgage or rental payments more than doubled between 2008 and 2018 in particular in Lithuania (from 0.4% to 1.2%), Denmark (from 1.1% to 2.9%), Luxembourg (from 1.1% to 2.3%), Cyprus (from 3.4% to 7.1%) and Greece (from 5.5 % to 11.2 %). On the other hand, there were thirteen Member States where the share of the population that was in arrears for mortgage or rental payments slightly decreased.

Figure 3: Share of the population in arrears on mortgage or rent payments, 2008 and 2018
(% of total population)
Source: Eurostat (ilc_mdes06)

The information presented in Figures 4-7 is for a broader concept, which extends beyond arrears for payments linked to housing (mortgages or rental), by including arrears for other items - utility bills or hire purchase payments which are typically paid as monthly instalments (note that the information presented excludes overdrafts, credit cards, or informal loans from friends and/or relatives). Less than one tenth (8.9 %) of the EU-27 population had such outstanding arrears in 2018 (see Figure 4). In Greece, almost half (43.0 %) of the population was in arrears for their mortgage or rent, utility bills or hire purchase payments, with this share above one fifth (20.0 %) in Bulgaria and Cyprus (31.9% and 21.6 %, respectively). By contrast, 16 out of 27 Member States recorded single-digit shares of less than 10.0 %, with the proportion of the population that was in arrears for mortgage or rent, utility bills or hire purchase payments falling to 3.8 % in the Netherlands, 3.0 % in both Czechia and Luxembourg (2017 data for the latter).

In 2018, the share of the population in Romania that was in arrears for mortgage or rent, utility bills or hire purchase payments was about 41.3 times as high as the share that was in arrears solely for mortgage or rental payments; a similar pattern was recorded in Croatia (20.7 times as high) and Bulgaria (18.8 times as high), where the vast majority of arrears were therefore linked to utility bills or hire purchase payments. By contrast, the share of the population in arrears for payments linked to housing in Czechia, France, Austria and the Netherlands accounted for at least half of the total population in arrears for the broader measure.

The overall proportion of the EU’s population in arrears for mortgage or rent, utility bills or hire purchase payments fell by 3.5 percentage points between 2010 and 2018. Nevertheless, in ten EU Member States, the share rose between 2008 and 2018, most noticeably in Greece and Cyprus (two countries that were particularly affected by the global financial and economic crisis). In all remaining 17 Member States the share of the population in arrears for mortgage or rent, utility bills or hire purchase payments fell, most noticeably in Croatia (-11.5 percentage points) and Italy (-10.0 percentage points).

Figure 4: Share of the population in arrears on mortgage or rent, utility bills or hire purchase, 2008 and 2018
(% of total population)
Source: Eurostat (ilc_mdes05)

Figure 5 provides an analysis over time for the share of the EU-27 population that was in arrears for mortgage or rent, utility bills or hire purchase payments. It shows a rising share of the population faced arrears during and in the aftermath of the global financial and economic crisis, with a peak being reached in 2013 when 12.9 % of the EU-27 population faced such difficulties. In 2010, the share of the EU-27 population living below the poverty threshold and in arrears for mortgage or rent, utility bills or hire purchase payments was 2.8 times as high as the corresponding share for the population living above the poverty threshold. This ratio increased gradually to reach a peak in 2017, when the likelihood of being in arrears across the EU-27 was 3.1 times higher when living below the poverty threshold than when living above it.

Figure 5: Share of the population in arrears on mortgage or rent, utility bills or hire purchase, by income situation, EU-28, 2010-2018
(%)
Source: Eurostat (ilc_mdes05)

The evidence that people at-risk-of poverty face a greater danger (than the rest of the population) from being unable to service their debt or other regular expenses is shown in Figure 6. In 2018, the share of the EU-27 population living below the poverty threshold that was in arrears on mortgage or rent, utility bills or hire purchase payments was 20.0 %, compared with shares of 8.9 % for the total population and 6.7 % for people living above the poverty threshold. This pattern was repeated in each of the EU Member States. Almost two thirds (61.7 %) of the population living below the poverty threshold in Greece reported that they were in arrears for such payments, with this share also above half (51.1 %) in Bulgaria. By contrast, this proportion was 15.0 % or less in ten Member States with Luxembourg having the lowest share at 9.7 %.

Figure 6: Share of the population in arrears on mortgage or rent, utility bills or hire purchase, by income situation, 2018
(%)
Source: Eurostat (ilc_mdes05)

While low income (in both relative and absolute terms) is undoubtedly a major contributory factor for explaining the proportion of the population that are in arrears for mortgage or rent, utility bills or hire purchase payments, there are other factors which may influence the ability of individuals to service their debt and other regular expenses; one of these is household composition. For example, people living in single person households with dependent children or households with three or more dependent children are more likely to face economic insecurity than the population as a whole (see Figure 7).

While just under one tenth (8.9 %) of the EU-27 population was in arrears for mortgage or rent, utility bills or hire purchase payments in 2018, this share was almost twice as high (16.5 %) among people living in single person households with dependent children and was also considerably higher (14.6 %) for the subpopulation living in households composed of two adults with three or more dependent children. Across all of the EU Member States, a higher than average share of single person households with children were living in arrears; this share peaked at 54.3 % in Greece and was at 39.4 % in Bulgaria. It was also common to find a higher than average share of the population living in households composed of two adults with three or more dependent children in arrears. This share peaked at almost two thirds (57.2 %) in Bulgaria, while the next highest shares were recorded in Greece (55.0 %) and Cyprus (30.4 %). Only in the Netherlands and Malta was the share of the total population in arrears higher than the corresponding share recorded among people living in households composed of two adults with three or more dependent children in arrears.

Figure 7: Share of the population in arrears on mortgage or rent, utility bills or hire purchase, by household type, 2018
(%)
Source: Eurostat (ilc_mdes05)

Physical safety

Within the context of this article, physical safety refers to being protected from any situation that puts an individual’s physical security at risk — this may include crime and violence. Often a perceived lack of physical safety may affect subjective well-being more than the real impact of any threat. For example, homicide causes only a small fraction of the total number of deaths in the EU-27 each year, however, its impact on people’s emotional lives can be considerable. Consequently, some crimes which have the potential to affect a person’s physical safety are often socially magnified, with an increase in feelings of insecurity or anxiousness.

In 2018, the ratio of homicides per 100 000 inhabitants reached a peak of 5.22 in Latvia, with the second and third highest rates also recorded among the Baltic Member States, with 3.45 homicides per 100 000 inhabitants in Lithuania and 1.90 in Estonia. At the other end of the range, the lowest ratios were recorded in Slovenia (0.48) Luxembourg (0.50) and Czechia (0.52) - see Figure 8.

A comparison between 2008 and 2018 reveals that the number of homicides per 100 000 inhabitants generally fell. The incidence of homicides fell by a considerable margin in both Lithuania and Estonia, while there was also a relatively large decrease in Bulgaria, Luxembourg and Romania. There were four EU Member States where the increase of the rate was observed: Austria, Sweden, Cyprus and Latvia.

Figure 8: Recorded homicides relative to population size, 2008 and 2018
(per 100 000 inhabitants)
Source: Eurostat (crim_off_cat)

As noted above, individual perceptions of crime rates do not always correspond to the actual prevalence of offences; this is one reason why subjective indicators may be useful as a complement to objective indicators. Across the EU-27, in 2018, almost one in nine persons (11.5 %) perceived that there had been crime, violence or vandalism in the area where they lived (see Figure 9). This share peaked at more than one fifth (21.8 %) of the population in Bulgaria, followed by 17.5 % in the Netherlands and 14.9 % in France. There were 13 Member States where the share of the population that perceived crime, violence or vandalism in their area was less than 10.0 %, with the lowest rates recorded in Hungary, Poland and Slovakia (each 4.8 %), Lithuania (3.7 %) and Croatia (2.6 %).

Between 2008 and 2018 there was generally a fall in the share of the population that perceived crime, violence or vandalism in the area where they lived. Across the EU, this proportion fell from 13.1 % in 2008 to 11.5 % in 2018, and also fell in a majority (19 out of 27) of the Member States. There were relatively large reductions in Latvia, Estonia, Denmark and Hungary. By contrast, the percentage of the population that perceived crime, violence or vandalism in the area where they lived increased at a modest pace in eight Member States, with Cyprus recording the biggest increase (by 3.8 percentage points).

Figure 9: Share of the population who perceived there was crime, violence or vandalism in the area where they live, 2008 and 2018
(% of total population)
Source: Eurostat (ilc_mddw03)

Figure 10 extends the analysis by presenting the reported perception of crime, violence and vandalism by income situation. While 14.1 % of the EU-27 population that were living below the poverty threshold in 2018 perceived there was crime, violence or vandalism in the area where they lived, this proportion was somewhat lower among the population living above the poverty threshold (10.9 %). This pattern was repeated in a majority of the EU Member States, and was particularly apparent in Belgium with respective proportions of 20.8 % and 10.7 %. The share for people living below the poverty threshold was at least 50 % higher than the share for people living above the poverty threshold also in Germany, Denmark, Slovakia and Hungary. However, there were six Member States where people living above (rather than below) the poverty threshold perceived a higher level of crime, violence or vandalism: Poland, Croatia, Latvia, Slovenia, Austria and Cyprus.

Figure 10: Share of the population who perceived there was crime, violence or vandalism in the area where they live, by income situation, 2018
(%)
Source: Eurostat (ilc_mddw03)

Physical safety by degree of urbanisation

Figure 11 shows an analysis of perceived crime, violence or vandalism by degree of urbanisation. In 2018, the perception among the EU-27 population that these issues were of relevance to the area where they lived was considerably higher for people living in cities (17.4 %), than it was for people living in either towns and suburbs (9.2 %) or rural areas (5.8 %).

Across all three degrees of urbanisation, the proportion of the population that perceived there was crime, violence or vandalism in the area where they lived was highest in Bulgaria. In 2018, the share of people living in Bulgarian cities that perceived such problems was 1.6 times as high as the EU-28 average (28.0 % compared with 17.4 %). At the other end of the range, some of the lowest levels of perception — across all three degrees of urbanisation — were recorded in Lithuania and Croatia.

In all of the EU Member States, the highest perception of crime, violence or vandalism was recorded among people living in cities. More than one quarter of city-dwellers in Bulgaria and more than 20 % in Germany, Greece, the Netherlands, Belgium and France reported such safety problems. The lowest perception of crime, violence or vandalism was generally recorded among people living in rural areas and this pattern was repeated in all Member States except Belgium.

In Latvia, the share of city dwellers who perceived that there was crime, violence or vandalism in their area was 12.3 times as high as for people living in rural areas. In Ireland, Denmark, Czechia, Poland, Germany, Croatia and Greece, the perception of safety problems among city-dwellers was at least 3.5 times as high as for people living in rural areas. On the other hand, in Slovenia, Belgium, Lithuania, Sweden, Bulgaria, Estonia, Romania and Hungary, the share of city dwellers who perceived such problems was less than double that recorded among people living in rural areas.

Figure 11: Share of the population who perceived there was crime, violence or vandalism in the area where they live, by degree of urbanisation, 2018
(%)
Source: Eurostat (ilc_mddw06)

Conclusion

The information presented above confirm the view that the global financial and economic crisis had a direct impact on the economic security of individuals in the EU-27; up until 2014 there was a gradual increase in the share of the population that was unable to cope with unexpected expenses and/or were in arrears on regular monthly payments, although both of these shares fell during the four subsequent years. A relatively high share of the populations of Greece, Bulgaria and Cyprus had arrears on mortgage payments, rent, utility bills or hire purchase payments in 2018, while economic insecurity — as measured by the share of the population that was unable to face unexpected financial expenses — affected more than half of the total populations of Latvia, Croatia and Greece.

People who were at risk of poverty (living below the poverty threshold) faced a greater likelihood of being unable to service their regular payments or face unexpected financial expenses, while households composed of single adults with children were generally the most economically vulnerable subpopulation when analysing the information by type of household.

Individual perceptions of crime rates do not always correspond to the actual prevalence of recorded offences. There was a considerable variation concerning the incidence of homicides relative to population size across the EU Member States in 2018: the highest ratio was recorded in Latvia, where the incidence of homicides was almost 11 times as high as in Slovenia (which had the lowest ratio). The perceived level of crime, violence or vandalism was generally higher among people living below the poverty threshold than it was for people living above the poverty threshold, suggesting that crime may be more prevalent in poorer areas.

Data sources

The data used in this article are primarily derived from the EU’s statistics of income and living conditions (EU-SILC) survey. EU-SILC is the principal instrument measuring income and living conditions in Europe, and is the main source of information used to link different aspects of the quality of life at an individual and household level. This source is used for the section presented in relation to economic security, as expressed through indicators that provide a proxy for wealth (for example, the share of the population unable to face unexpected financial expenses) and debt (for example, the share of the population in arrears).

There are two sources of data used for the second section on physical safety issues: statistics are taken from EU-SILC to cover perceived levels of crime, violence or vandalism in the areas where people live, providing subjective information that may be contrasted with objective information that is taken from Eurostat’s database on crime and criminal justice.

The provision of data on crime in the EU is complicated by considerable differences in the methods and definitions used in the EU Member States; this should be taken into account when using these statistical data. Crime statistics tend to be reported as ratios per 100 000 inhabitants to allow the incidence of different criminal offences to be compared across countries.

Homicide is defined as the intentional killing of a person, including murder, manslaughter, euthanasia and infanticide; it excludes death by dangerous driving, abortion, assisted suicide and attempted homicide. In contrast with other criminal offences, these statistics relate to the number of victims, rather than the number of criminal cases. Data on homicides are thought to be among the most comparable of crime statistics as they are universally reported (because of their seriousness) and there is little scope for definitions to vary (when compared with other types of crime).

Context

There are a range of different risks that may unexpectedly and/or adversely affect a household’s or an individual’s material conditions, as well as their physical security. For the purposes of statistical measurement, two categories of security have been distinguished: economic security and vulnerability is analysed in relation to wealth and debt, while physical and personal safety is covered by the recorded incidence of criminal offences as well as perceived levels of crime in areas where people live. Alongside experiencing such criminal acts, these subjective perceptions may result in feelings of insecurity that have the potential to undermine an individual’s quality of life.

The concept of economic security is mainly addressed by European policies that relate to the safety nets provided by the social security systems of individual EU Member States. The Social Protection Committee (SPC) is an EU advisory policy committee established by the Treaty on the Functioning of the EU (Article 160) and monitors the development of social protection policies in the EU Member States.

The Council of the European Union endorsed the EU’s strategy for internal security, titled Towards a European Security Model, at a meeting held in March 2010. The strategy set out the challenges, principles and guidelines for dealing with security threats related to organised crime, terrorism and natural and/or man-made disasters. The European Commission adopted a Communication titled The EU Internal Security Strategy in Action: Five steps towards a more secure Europe (COM(2010) 673 final) with a set of proposed actions for implementation during the period 2010-2014 and this was followed by another Communication titled European Agenda on Security (COM(2015) 185 final) which extended the work done in the area of security, replacing the internal security strategy.

During the period 2015-2017 there was a wide debate around the theme of ‘social Europe’ between EU institutions, Member States, social partners, civil society and citizens. Developments in this policy area centred on a new pillar of social policy: in November 2017, the European Pillar of Social Rights was proclaimed during a summit for fair jobs and growth that took place in Gothenburg, Sweden. It aims to deliver fairness and social justice through new and more effective rights for citizens (the social acquis) and has three main categories covering 20 different principles that are spread over policy areas such as housing, education, social or health care, and employment:

  • equal opportunities and access to the labour market;
  • fair working conditions;
  • social protection and inclusion.

The third category covers a broad range of principles that may be grouped under the heading of safety, covering: childcare and support to children; social protection; unemployment benefits; minimum income; old-age income and pensions; health care; inclusion of people with disabilities; long-term care; housing and assistance for the homeless; access to essential services.

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Further Eurostat information

Main tables

People at risk of poverty or social exclusion (Europe 2020 indicators) (t_ilc_pe)
Income distribution and monetary poverty (t_ilc_ip)
Living conditions (t_ilc_lv)
Material deprivation (t_ilc_md)


Recorded offences by offence category - police data (crim_off_cat)
Recorded intentional homicide and sexual offences (crim_hom)
Court processes (cim_crt)
Prison and prisoner characteristics (crim_pris)
People at risk of poverty or social exclusion (Europe 2020 indicators) (ilc_pe)
Income distribution and monetary poverty (ilc_ip)
Living conditions (ilc_lv)
Material deprivation (ilc_md)
EU SILC ad-hoc modules (ilc_ahm)