Greece’s ‘des­per­ate house­holds’

ECB sur­vey shows fam­i­lies are the safety net of peo­ple who have lost their jobs and seen sav­ings van­ish

Kathimerini English - - Focus -

Greek house­holds­gen­er­ally own their home and have a car; they of­ten have a house in the vil­lage their fam­ily hails from too. How­ever, their bank ac­counts are shrink­ing, their loans are not be­ing ser­viced as promptly as they used to be and their liq­uid­ity is close to zero. Un­em­ploy­ment is now chang­ing the struc­ture of house­holds, re­sult­ing in young and old be­ing forced to stay un­der the same roof.

These are the main fea­tures of Greek house­holds dur­ing the economic crisis as recorded by the Euro­pean Cen­tral Bank’s House­hold Fi­nance and Con­sump­tion Sur­vey, which cov­ers the 2010-14 pe­riod and was pre­sented in Greece yesterday in the weekly bulletin of the Hel­lenic Fed­er­a­tion of En­ter­prises (SEV).

Un­der the ti­tle “Des­per­ate House­holds,” the bulletin high­lighted that fam­i­lies con­tinue to pro­vide a safety net; how­ever, it showed that their stamina is also run­ning low, as is that of the friend net­work. The rate of Greek house­holds that said they could seek fi­nan­cial sup­port from rel­a­tives and friends dropped to 36.5 per­cent in 2014 from 59.4 per­cent in 2009. The sit­u­a­tion is cer­tain to have de­te­ri­o­rated fur­ther in the last cou­ple of years.

Few Greeks have the lux­ury of be­ing able to save money: Just 13.5 per­cent of house­holds said they added to sav­ings on a reg­u­lar ba­sis, down from 21.9 per­cent five years ear­lier. This is by far the low­est rate in the Euro­pean Union.

The in­dex of liq­uid­ity as a ra­tio of dis­pos­able in­come was at just 2.8 per­cent in Greece, down from 4.9 per­cent five years ear­lier, and against a euro­zone av­er­age of 16.7 per­cent.

There was a no­table de­cline in the rate of heads of house­holds who are self-em­ployed (from 18.9 per­cent to 14.4 per­cent within five years) and those who are salary work­ers (from 1.0514 39.7 per­cent to 36.5 per­cent). In con­trast, the rate of heads of house­holds who were re­tired in­creased from 34.7 per­cent to 39.3 per­cent, and those who were out of work from 6.6 to 9.8 per­cent.

An­other study by the Cologne In­sti­tute for Economic Re­search showed yesterday that Greece is top among Euro­pean coun­tries in terms of poverty growth, as the num­ber of Greeks be­low the poverty line grew 40 per­cent from 2008 to 2015.

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