Convergence: Living conditions

10 December 2018

Upward convergence in living conditions is of great importance for the EU. The EU’s 2015 Five Presidents report Completing Europe's economic and monetary union acknowledges the need for convergence in social performance and social cohesion. It argues for a ‘social protection floor’, referring to education, pensions, healthcare and social security. The 2017 European Pillar of Social Rights further emphasises the need for social protection and inclusion. The investigation of this area is organised in three main subdimensions: overall life experience, living standards and quality of society.

Dimension 1: Overall life experience

Life satisfaction remained generally stable from 2007 to 2016. However, Member States have converged in their scores, particularly from 2007 to 2011, when they converged in both the euro zone and non-euro area, but more so in the non-euro area. While in the period 2011–2016 an overall increase in heterogeneity was recorded, convergence continued – albeit at a slower pace – in non-euro area Member States.

Life expectancy at birth recorded strict upward convergence in the period assessed (2002–2015). This was caused by the convergence which took place from 2007 to 2015, following a period largely marked by divergence (2002–2007). This pattern has been similar in euro and non-euro countries, but variability has been larger in the non-euro area, with a rather stable gap between the two areas.

Dimension 2: Living standards

Upward convergence was recorded in the AROPE indicator from 2005 to 2018. This effect was mainly driven by a strong upward convergence movement from 2005 to 2008. Variability between countries has been consistently higher in the non-euro area than in the euro zone. In both areas, variation has decreased from 2005 to 2016. The decrease was stronger, though, in the non-euro area, so the gap in variability between the two areas has decreased.

In-work poverty has downwardly diverged somewhat from 2005 to 2018, with an increase in the EU Member State average, moving away from the policy objective. The unweighted average increased more or less constantly over the period considered, while the standard deviation decreased from 2005 to 2011 and then increased from 2011 onward. For this reason, two main periods can be identified: the first from 2005 to 2011 with downward convergence followed by a second, from 2011 onward, of downward divergence. In this period, the variability between countries has been consistently higher in the non-euro area than in the euro zone. In both, variation has shown a fluctuating pattern with little change overall, leaving the gap between both areas approximately constant.

Downward convergence was recorded for the material deprivation indicator in the period from 2007 to 2016, with an increase in the share of individuals experiencing material deprivation in the EU. Certain periods may be identified. Firstly, convergence from 2007 to 2016 was larger in the non-euro area than in the euro zone. Variation in unweighted averages and standard deviation increased markedly from 2007 to 2011 as a result of the crisis. Then they decreased from 2011 to 2016. Overall a downward convergence trend was recorded.

Dimension 3: Quality of society

Trust in government converged downward from 2007 to 2016. This was caused by divergence from 2007 to 2011, as Member States converged between 2011 and 2016. From 2007 to 2011, there was sharp divergence in the euro zone, but not outside it. From 2011, there was convergence in both areas. Until 2011, variation was largest in the non-euro area, but from then on it was larger in the euro zone. Countries which show clear signs of convergence or divergence can be identified. Some Member States show a negative development.

The quality of government indicator was about the same in 1996 and 2017, but analysis of the standard deviation reveals that Member States have converged, reducing their disparities. Convergence has been almost continuous, except during some short periods, in particular 2005–2007. The euro zone and non-euro area countries have shown a similar convergence pattern, but variability has been continuously higher in the non-euro area. Countries which show clear signs of convergence or divergence can be identified.

The Social Exclusion Index recorded upward convergence from 2007 to 2016, when the EU average decreased from 2.19 in 2007 to 2.12 in 2016 while the standard deviation decreased as well. However, overall two periods may be identified: in the first period, from 2007 to 2011, downward divergence was recorded. Then from 2011 to 2016 a robust upward convergence trend was in place. Overall, the euro zone and the non-euro area recorded different trends in terms of variability. This has been higher in the non-euro area than in the euro zone, but the gap decreased, caused by a sharp decrease from 2007 to 2011.

The volunteering rate diverged downward in 2011–2016, with a decrease in the unweighted average and a sharp increase in the standard deviation. There was divergence in both the euro and non-euro countries, but it was stronger in the non-euro Member States. Variation has been higher in the non-euro area, and the gap has increased. While the limited period of time included in the analysis does not permit elaborate analysis, countries which show clear signs of convergence or divergence can be identified.

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