Einar H. Dyvik
Research expert covering Nordics and global data for society, economy, and politics
Poverty - statistics & facts
The results are in: poverty is reducing around the world. This is especially down to the reduction of poverty in East Asia, where the economic growth of China has contributed to lifting millions out of poverty. Despite these positive developments, in 2022, the number of people living in poverty globally still reached an estimated 711 million. Moreover, the global poverty rate increased slightly during the COVID-19 pandemic, and high inflation rates have reduced the purchasing power of many around the world. Countries with the highest poverty rate are mostly in Sub-Saharan Africa, where millions do not have enough income to feed their families.
Furthermore, measuring the share of people living below the poverty line has some limitations as it does not take the depth of poverty into account. Hence, if the 79 percent of the population in the Democratic Republic of Congo currently living on less than 2.15 U.S. dollars a day becomes even poorer, the share will remain the same. Therefore, using the worldwide poverty gap to measure the severity of poverty, i.e. how far below the poverty line the average poor person in a country is, the data shows that the poverty gap has decreased from 11.8 percent in 2012 to 8.1 percent in 2022.
Defining Poverty
Poverty refers to the lack of money or material possessions needed to meet basic needs and/or an adequate living standard. The definition of poverty varies over time; whereas up until recently, the global poverty line was set at 1.90 U.S. dollars a day in terms of Purchasing Power Parities, it reached 2.15 U.S. dollars in September 2022 due to rising inflation. Moreover, the national poverty levels vary greatly. For instance, while the poverty rate in the United States shows that 11 percent of the population lived in poverty in 2023, this is not necessarily comparable to the share of population living in poverty in Nigeria, as a person residing in the United States will need a far higher level of income to afford a basic standard of living.Furthermore, measuring the share of people living below the poverty line has some limitations as it does not take the depth of poverty into account. Hence, if the 79 percent of the population in the Democratic Republic of Congo currently living on less than 2.15 U.S. dollars a day becomes even poorer, the share will remain the same. Therefore, using the worldwide poverty gap to measure the severity of poverty, i.e. how far below the poverty line the average poor person in a country is, the data shows that the poverty gap has decreased from 11.8 percent in 2012 to 8.1 percent in 2022.
Dimensions of poverty
Poverty is usually divided into absolute and relative poverty. The first concerns basic human needs such as food, water, sanitation, and shelter. Relative poverty, on the other hand, relates to whether a person can afford a certain standard of living and participate in social life. The many different dimensions of poverty are interrelated. For instance, while global water access has improved and the share of undernourished people worldwide has remained stable since 2021, social dimensions such as lack of access to education, poor sanitary conditions, and regional conflict can also result in poverty or in the worst cases, mortality. Researchers have found that to fight global poverty effectively, the many dimensions of the phenomenon must be addressed simultaneously.Poverty and wealth inequalities
Finally, poverty is interrelated with wealth inequalities. In 2022, a nearly 40 percent share of the world's collected net personal wealth belonged to the richest one percent. Moreover, many countries with the greatest inequality in income distribution worldwide also ranked as the poorest. Hence, we may be seeing a development where relative poverty becomes more profound in middle- and high-income countries, whereas absolute poverty remains most dominant in low-income countries. Moreover, the high inflation seen over the past year has driven more people into poverty as purchasing power decreases.
