The share of minimal wage revenue spent on lease varies throughout Europe, from 35% in France to 56% within the Netherlands. Euronews Enterprise examines minimal wages and common lease prices in EU nations.
“Housing, water, electrical energy, and gasoline” constituted the biggest portion of family expenditures within the EU. In 2022, practically 1 / 4 of all family spending (24.1%) was allotted to those important wants, clearly displaying the substantial weight they carry in European family budgets.
This proportion varies considerably throughout European nations and, extra importantly, in response to revenue ranges inside every nation. Minimal wage earners, particularly, are closely impacted, as they allocate a bigger share of their revenue to “housing, water, electrical energy, and gasoline”.
The European Commerce Union Confederation (ETUC) stories that, in 14 EU member states, lease for a property with a most of two bedrooms takes up a minimum of 35% of the revenue of staff on the statutory minimal wage. In 2024, on common, these staff spend 45% of their earnings on housing alone, illustrating the heavy monetary burden that housing prices place on low-wage earners throughout these nations.
“Tens of millions of working individuals in most member states see an enormous a part of their wages depart their financial institution accounts as quickly because it’s are available merely to maintain a roof above their heads,” ETUC Normal Secretary Esther Lynch stated.
How a lot does it price to lease a property with as much as two bedrooms in varied European nations? What’s the month-to-month wage of minimum-wage earners throughout Europe? And which nations see the best proportion of revenue spent on lease by these incomes the minimal wage?
Minimal wage varies broadly, from €477 to €2,571
Among the many 14 nations included within the analysis, statutory minimal wages ranged from €477 in Bulgaria to €2,571 in Luxembourg. Solely six of those nations have a minimal wage above €1,000, with three exceeding €2,000: Luxembourg, Eire, and the Netherlands.
Denmark, Italy, Austria, Finland, and Sweden shouldn’t have a nationwide statutory minimal wage.
Common lease throughout 14 nations is €600
The lease for a property with a most of two bedrooms ranged from €215 in Bulgaria to €1,340 in Luxembourg, whereas the common of 14 nations is €599.
In seven nations, the common lease was beneath €400, together with Bulgaria (€215), Romania (€277), Croatia (€311), Greece (€344), Slovakia (€371), Estonia (€387), and Portugal (€391). On the upper finish, common lease exceeded €1,000 in Luxembourg, Eire, and the Netherlands, whereas it was €618 in France and €578 in Spain.
Lease calculations are based mostly on Eurostat’s 2022 knowledge, adjusted for inflation.
Portion of minimal wage spent on lease
The portion of minimal wage revenue spent on lease provides priceless insights into the monetary burden lease locations on low-wage earners. Among the many 14 nations, this proportion ranged from 35% in France to 56% within the Netherlands. On common, minimum-wage earners throughout these nations spend 45% or 46% of their revenue on lease, relying on the calculation technique used.
Along with the Netherlands, the place the proportion reaches 56%, lease consumes over 50% of minimal wage revenue in each Eire (55%) and Luxembourg (52%).
France has the bottom proportion at 35%, that means lease accounts for roughly a 3rd of minimum-wage staff’ revenue. Croatia (37%) and Greece (38%) comply with carefully behind France in having decrease rent-to-income ratios for minimal wage earners.
In Bulgaria, the place each minimal wages and lease are the bottom, staff nonetheless spend a big 45% of their revenue on lease. In Spain, this proportion is equally excessive at 44%.
The price of lease is predicated on nationwide averages; nevertheless, the scenario might be much more difficult in cities and capital areas, the place most jobs are concentrated.
“Regardless of paying excessive rents with low wages, their lodging is usually completely insufficient, exposing them and their households to well being circumstances,” stated Esther Lynch.
“Others are compelled to sleep on the sofa of their associates’ residences, proceed dwelling with their dad and mom when doable, and even sleep of their vehicles,” she added.
How a lot do European nations spend on housing and payments?
We will additionally study further knowledge from Eurostat that goes past minimal wage and lease alone. This dataset displays the proportion of whole family expenditure allotted to housing, water, electrical energy, gasoline, and different fuels, which varies considerably throughout Europe.
In 2022, Slovakia topped the checklist, with over 30% of family expenditure allotted to housing, water, electrical energy, gasoline, and different fuels. Finland and Denmark adopted carefully, with households spending 29.6% and 29.1%, respectively, on housing and utilities.
In distinction, Malta (13.9%) and Croatia (14.9%) allocate a a lot smaller share of their bills to housing and utilities.
The chart highlights that Northern and Central European nations face substantial monetary pressures associated to those prices.
This expenditure consists of:
Precise leases for housing
Imputed leases for housing
Upkeep and restore of the dwelling
Water provide and miscellaneous providers referring to the dwelling
Electrical energy, gasoline and different fuels
In 2019, this proportion was 25.7% within the UK, a former EU member.