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INCOME

Sweden’s growing wealth gap ‘troubling’: Borg

Figures showing financial improvements for Sweden's middle and upper classes, at the same time the country's poorest have seen their incomes decline have given finance minister something to fret about.

Sweden's growing wealth gap 'troubling': Borg

Figures showing that income differences are on the rise in Sweden, with most household wallets growing fatter, as those with lowest income fall behind, are ‘troubling’, according to minister of finance Anders Borg.

Nearly everyone in Sweden has seen their incomes rise in the last five years.

However, those included in the ten percent of the population earning the least have seen their incomes fall by 5.5 percent, or 350 kronor ($50) per month after tax, according to figures from Statistics Sweden.

In the same time, incomes for the ten percent of the Swedish population earning the most have risen by 7,300 kronor, or roughly 23 percent.

According to the statistics, the higher income a someone had in 2005, the greater percentage increase in income they experienced in the last five years.

Figures indicating that Sweden’s rich are getting richer while the country’s least well-off earn less don’t sit well with finance minister Anders Borg.

“We ought to have a country that sticks together, and it’s naturally troubling to see indications of the opposite,” he told news agency TT.

Borg suggested potential changes in government spending he envisions may help put a stop to the trend.

Increased subsidies for pensioners and families with young children, as well as loosening the strict rules for receiving welfare, are some possible changes he suggested.

However, the growing income differences should be no surprise to Borg, or the centre-right government, as their own budget proposal for 2010 included the prediction that lowering income taxes would lead to growing income gaps.

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EMPLOYMENT

Almost one in ten live in poverty in Switzerland: Report

More than eight percent of Switzerland’s population live in poverty, while 12 percent struggle to make ends meet.

Almost one in ten live in poverty in Switzerland: Report
A number if people in Switzerland can't make the ends meet. Photo by Depositphotos

A study released by the Federal Statistical Office (FSO) on Thursday shows that 8.7 percent of Switzerland’s public – around 735,000 people – live in poverty, which is defined at 2,279 francs per month on average for a single person, and 3,976 francs per month for two adults and two children.

When adjusted for purchasing power, this threshold is the second-highest in Europe, topped only by Luxembourg.

 

The numbers are for 2019, so the impact of the Covid-19 pandemic is not yet included in the data.

The poverty rate in Switzerland is the highest it has been since 2014, the study found. 

Most financial difficulties were experienced by foreign nationals, people living in single-parent households, people without training, and those living in households impacted by unemployment, FSO reports.

Here are some of the study’s other findings:

  • For the 10 percent of the population with the lowest wages, this income was less than 25,868 francs in 2019. The median income has remained stable at around 50,000 francs. 
  • The poverty rate for the employed labour force was 4.2 percent in 2019. About 155,000 people were living below the poverty line, even though they were in paid work.
  • Just over 12.2 of the population said they had difficulty making ends meet, and 20.7 percent were unable pay an unforeseen expense of 2,500 francs in the space of a month . Of these, 15.1 percent had at least one payment arrears.

READ MORE: Switzerland’s economy forecast to recover 'from summer onwards' 

On the positive side, the country’s general standard of living remains among the highest in Europe.

It is estimated on the basis of the median disposable income, after adjusting for differences in price levels in various countries. 

In Switzerland, this income was 2.8 times higher than in Greece, 1.6 times higher than in Italy, 1.3 times higher than in France, and 1.2 times higher than in Germany and in Austria.

Despite the high price level in Switzerland, the standard of living was higher in Switzerland than in most of the EU countries.


 

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