Reduction of Poverty and Material Deprivation in the EU Countries: What Matters the Most?

Poverty reduction belongs to the long-term priorities of public policy actions in most countries. In 2010, the European Union and its member states aimed to reduce the number of people living at risk of poverty by 2020. However, most EU countries failed to achieve their targets concerning poverty reduction, partly because of the challenges they had to cope with (slow economic recovery after the crisis, migration, COVID-19). In 2022, poverty risks were increasing in the EU countries once again. Therefore, research focused on determinants of poverty can help policymakers to identify the areas in which policy measures will be useful for poverty reduction or at least its stabilisation in the EU countries. The paper introduces an analysis examining five determinants of poverty (related to employment, incomes, education, and social protection), when poverty was understood in terms of incomes as well as material deprivation. The panel regression analysis was done for cross-sectional data covering EU 26 countries and the period 2010–2019. Statistical results revealed the statistically significant relationships between poverty risks (measured with the use of at-risk-of-poverty rate and rate of material deprivation), and employment, work intensity, and income inequality (representing the determinants of poverty). Findings indicated that particularly the policy measures adopted within the employment and labour market policies must be used in the fight against poverty in EU countries.