Youths Leaving Albania due to Lowest Income in Europe
Exodus of young people has become a really worrying problem for the country, affecting the labor market, consumption and in the longer term jeopardizing productivity, economic well-being and the pension system.
Eurostat data sheds light on one of the reasons for this exodus: low incomes. According to Eurostat figures, processed by "Monitor", young Albanians in the 16-24 age group have the lowest disposable income, not only in Europe, but also in relation to other countries in the region.
Eurostat has published the median disposable income indicator which measures the total income of a household, after taxes and other deductions, that is available for spending or saving, divided by the number of household members (converted to adults).
The indicator is expressed according to the standards of purchasing power per inhabitant (PPS) and is detailed in addition to the total by age groups.
For the Albanian 16-34 age group, the median income is PPS 4,226, out of 16,385, which is the European Union average for the same age group, or about 26% of the European average. Converted into the national currency, according to Eurostat, the median annual income per inhabitant is 299,000 ALL. (the median means that half of the population has disposable income lower than ALL 299 thousand and half more). While the average income is 346 thousand ALL, according to Eurostat.
Young people in the region have more disposable income. For North Macedonia, the indicator is 5,421 PPS, or 28% higher than in Albania.
In Serbia, the income of comparable youth according to purchasing power is 6,410, or 52% higher than that of Albanian youth.
In Montenegro, the indicator is 6,050 PPS, or 43% higher than the 16-24 age group in Albania.
Eurostat's data for the region are for 2020, while the figures for Kosovo are missing.
According to Eurostat, equivalent disposable income is calculated in three steps:
– all monetary income received from any source by each member of a family is collected; these include income from work, investments and social benefits, plus any other household income; taxes and social contributions that have been paid are deducted from this amount;
– to reflect changes in the size and composition of a family, the total (net) income of the family is divided by the number of 'equivalent adults', using a standard (equivalent) scale: the modified OECD scale; this scale assigns a weight to all family members (and then sums these to arrive at equal family size):
-1.0 for the first adult;
-0.5 for the second person and each follower aged 14 and over;
-0.3 for each child under 14 years of age.
Finally, the resulting figure is called equivalent disposable income and is attributed equally to each family member.
For Albania, the indicator is 4,385 PPS, which refers to the year 2020, out of about 18 thousand PPS which is for the average of the European Union (for 2020-2021), or as much as 24.4% of the European average.
(Source: Monitor)