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Sunday 23.09.2018 | Name days: Vanda, Veneranda, Venija
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Latvian households’ disposable income grew 4.9% in 2016

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Baltic news, News from Latvia, BNN.LV, BNN-NEWS.COM, BNN-NEWS.RUCompared to 2015, household disposable income increased by 4.9 %, reaching 437 euros per household member monthly in 2016.

The growth rate of household income continued to slow down, compared to the increase recorded in the previous years – 7.6 % in 2015, 9.3 % in 2014 and 10.7 % in 2013, according to results of a survey performed by the Central Statistical Bureau of Latvia in 2017.

In 2016, household disposable income in urban areas increased by 4.2 %, reaching 467 euros monthly. In rural areas, the indicator rose more rapidly – by 6.7 %, reaching 372 euros monthly. Regional breakdown indicates notable differences in monthly household income per household member. The largest growth in household disposable income was recorded in the Pierīga region – of 7.2 % (478 euros monthly), while the lowest increase was observed in the Kurzeme region – of 1.8 % (396 euros monthly). Income in Riga grew by 3.7 % (528 euros monthly), in Zemgale – by 4.9 % (386 euros monthly), in Latgale – by 5.6 % (300 euros monthly), in Vidzeme – by 6.7 % (366 euros monthly).

In 2016, household income from labour per household member rose by 6.1 % – from 293 euros a month in 2015 to 311 euros a month in 2016. Income from social transfers (pensions, allowances and other budgetary payments) per household member grew faster than income from labour for the first time since the financial crisis – by 6.6 % (from 101 euros a month in 2015 to 108 euros a month in 2016).

In 2016, the share of income from labour amounted to 71.2 % of the total disposable income (70.4 % in 2015), while the share of social transfers amounted to 24.7 % (24.3 % in 2015).

In 2016, compared to 2015, the lowest increase in income was observed in the poorest households (by 2.8 % in households of the 1st quintile group and by 3.6 % in households of the 2nd quintile group). The income of the richest households, belonging to the 5th quintile group, increased by 5.1 % over the year. The largest growth in income was recorded in households of the 4th and 3rd quintile groups (by 6.4 % and 5.7 %, respectively). The Gini coefficient of Latvia did not change over the year (34.5 %), while the income of the 20 % of the richest population was 6.3 times higher than that of the 20 % of the poorest population (6.2 times higher in 2015).

Compared to other European Union (EU) Member States, the income inequality level in Latvia remained high.

According to the latest data, the Gini coefficient of Latvia was the fourth highest among EU Member States. The coefficient was higher only in Bulgaria (38.3 % in 2015), Lithuania (37.0 % in 2015) and Romania (34.7 % in 2015), while Spain had the same indicator as Latvia (34.5 % in 2016), and the average coefficient of EU amounted to 30.8 % (in 2015). The quintile share ratio was also one of the highest in the EU (7.9 in Bulgaria (2015), 7.2 in Romania (2015), 7.1 in Lithuania (2015), 6.6 in Spain and in Greece (2015), 6.3 in Italy (2015) and 6.3 in Latvia (2016), while the EU average amounted to 5.2 (2015).

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