The economic welfare of low-income households 2019

Most Norwegian households are financially relatively well-off, although they experienced a small decrease in real incomes between 2014 and 2017. During the same period, there was an increase in income inequality between the households, where the gap between those at the bottom of the distribution and those at the top increased somewhat. Accordingly, the share of people in low-income households in Norway has grown from 10.8 per cent in 2014 to 11.2 per cent in 2017. Back in 2011, the corresponding share was 9.6 per cent.

The aim of this report is to thus to shed more light on the economic situation and living conditions of various low-income groups, like single parents, immigrants and recipients of various social security benefits.

This report states that low income is most common among groups who to a large extent are outside the labour market. The share of people in low-income households is especially big among single persons receiving the minimum level of old-age pension or disability benefit, recipients of social assistance and newly arrived refugees who are in receipt of the Introduction Benefit. However, those experiencing the most rapid growth in the proportion of low-income in recent years are single parents, couples with children and people with reduced ability to work. At the same time, the prevalence of low income has declined among groups such as immigrants from EU-countries etc., Norwegian-born with immigrant parents, long-time unemployed, single persons 67 years and older and old-age pensioners in general.

Some people only experience a short period of low income, while low income is a more persistent situation for others. In the three-year period 2015-2017, 9.6 per cent of all persons belonged to a household with persistent low income. The proportion with persistent low income was stable around 8 per cent for many years up until the period 2010-2012. In the following years, the share with persistent low income has increased annually.

A majority of the various low-income groups report of poor housing conditions, compared to the population in general. Many also find the housing expenses burdensome and report more frequently of economic problems. Compared to the population in general, material and social deprivation is more common among people in low income groups. Poor living conditions are most prevalent among social assistance recipients and immigrants from Africa, Asia etc. However, there are also a relatively big share who report of poor living conditions among single parents, low-income couples with children and people receiving disability benefits or work assessment allowance (AAP).

In an international perspective, the proportion of people in low-income households in Norway is small. However, compared to other Nordic countries like Denmark and Finland, the share of children with low income has risen substantially in recent years. This is also the case in Sweden. Still, the share of people in households in material deprivation or in risk of poverty or social exclusion, is relatively small in the Nordic countries compared to other EU- and OECD-countries.