Employment crisis and risk of poverty

Traditional patterns of poverty risk in Southern European countries (Greece, Italy, Portugal and Spain) tended to show lower comparative levels of poverty risk among employed people and higher levels among unemployed people. Composition and evolution of these poverty risks might differ depending on the relevance in each country of the three basic determining factors: level and dispersion of wages, composition of households in terms of working age and dependent members, and income social transfers to households. The recent crisis of employment has been quite severe in some countries – with lowering of more than 10 per cent of total employment in Spain and Greece—and less severe in others. The economic recession has also prompted some labour market and social protection reforms with the potential effect of increasing in-work poverty risks. This paper is aimed to analyse changes in working poverty risks during economic recession in Southern countries and to asses the potential effect on those risks of recent labour market and social protections reforms.