EU economic crisis causing massive rise in poverty – Red Cross

Europe is facing a catastrophic economic and social decline, according to a new Red Cross report. The charity concludes that austerity measures taken during Europe’s economic downturn have further contributed to snowballing poverty and unemployment.

“Whilst other continents successfully reduce poverty, Europe adds to it,” says the report, entitled “Think differently: Humanitarian impacts of the economic crisis in Europe.”

The 68 page Red Cross report, published Thursday, adds: “We now see a quiet desperation spreading among Europeans, resulting in depression, resignation and loss of hope for their future.”

Five major trends characterizing the impact of the economic crisis across Europe are identified in the document: the poor getting poorer; the ‘new poor’ spiraling into poverty; weakening health; a toughening stance on increasing migration; and a steep rise in unemployment.

The study ominously warns that “the long term consequences of this crisis have yet to surface,” despite already very serious, visible symptoms of economic downturn being detailed throughout its pages.

The Red Cross’s research includes data and conclusions collected from a wide range of European countries, from Belgium, Georgia, Greece and Italy to Sweden, charting statistics from the 28 countries of the EU plus 14 in the Balkans, Eastern Europe and central Asia.

“While poverty has increased, social services have been reduced,” the Italian Red Cross notes in its report. “Public services simply cannot respond to the ever-growing needs,” the report cites Marco Tozzi, a Red Cross volunteer, as saying. “Poverty is on the increase in France, Romania, Spain, Sweden and many other countries as reported by National Red Cross and Red Crescent Societies through the IFRC’s mapping exercise.”

Among more general trends, such as increases in poverty, unemployment and reductions in social services, some secondary social consequences are also identified. Grown-up children have been found to be moving back in with their parents in Greece and Spain, and generations are living under a single roof with just one income-earner to pay for the household’s upkeep.

However, there is simultaneously a broadening inequality gap. “Not only are more people falling into poverty, but the poor are getting poorer, and the sense is that the gaps between the wealthy and the poor are growing,” the report states, adding that those suffering the most in Europe were those identified as already badly off.

In Romania, “the most affected people are those who are already poor: the retired, the disabled, people living on social welfare," while the French Red Cross expresses concern that “75 per cent of people [in France] asking for food explain doing so because otherwise they could not afford to pay their rent.” The Romanian Red Cross also noted a fall in the country’s average salary by 24 percent, accompanied by an increase in living costs of about 30 percent from 2008 to 2012.

While these trends may be expected in crisis-stricken countries such as Spain and Greece, which have both seen waves of intense protests, spiking unemployment figures and increasing reliance on charity, worrying statistics illustrating the situation in countries such as Germany are also identified.

The German middle class is contracting at a rapid speed, the report notes, citing figures from a Bertelsmann Foundation study; in 1997, some 65 percent of Germans were identified as middle class, while this number drops to 58 percent in 2012, meaning that some 5.5 million Germans have lost their “class status,” according to the study. However, half a million stepped “up” a class, being identified as high-income earners.

Mass unemployment and deepening poverty across Europe have increased the needs of people seeking help from the Red Cross across the continent, as they have increasingly come to rely on charity. “The amount of people depending on Red Cross food distributions in 22 of the surveyed countries has increased by 75 percent between 2009 and 2012,” the report says.  

Psychological impact: Greek suicide rate up 40 percent

While the inability to obtain sufficient commodities or energy contributes to the general decline in public health on account of long-term cuts (and thereby costing more in the long-term), the level of mental health of the general population is also worse as a result of psychological suffering.

National Red Cross and Red Crescent Societies report an increased need for psychosocial support to people suffering from depression and other mental health problems, according to the report. A prime example of the ongoing mental anguish suffered by those thrown into poverty has been apparent in Greece over the past three years.

“Suicide rates in Greece have grown drastically by as much as 40 percent between January and May 2011, compared to the same period in 2010, a 50-year high,” the report notes.

The continent is also witnessing an increase in economic migration, matched by a parallel increase in anti-migration sentiment in host countries.  “Labor migration has been the major response to social, demographic and economic challenges, and [a] survival strategy for the majority of families in [the] Central Asia and Southern Caucasus region,” the report finds.

Around 10 percent of Russia’s entire population is identified as migrants from Central Asia and the South Caucasus – between 12 and 14 million people. Sweden has also seen a high number of migrants seeking to take up residency inside its borders, with some 35,000 undocumented migrants thought to be living in the country, alongside the high number of people entering the country from within the EU looking for work.

“Unfortunately, many of them end up living on the streets and without means to support themselves,” the report notes. It further underlines how that the public stance on migrants has ‘toughened’ somewhat. The Austrian Red Cross states that: “The government, together with EU governments and EU agencies is strongly supporting the tendency to externalize the EU asylum system and thereby they are trying to keep migrants (among them potential asylum seekers) outside the EU territory.” Alongside Sweden, Norway also notes that it has experienced a “steep increase in the number of European labor migrants.”

Despite the increase in labor-based migration, unemployment remains a serious issue, with a massive 120 million Europeans living in, or at risk of, poverty in total, while youth unemployment in one-quarter of the countries ranges from 33% to higher than 60%.

“As of the third quarter of 2012, there were 11 million long-term unemployed in the EU alone. This is 1.3 million more than the year before and 5.2 million more than in 2008,” the report says. As well as potentially contributing to declining mental health, the long term effects of increasing unemployment levels also indicate an influence on increased social unrest.

“The graph from [the International Labor Organization] shows that the risk [of] social unrest has increased 12 percent in Europe from 2011–2012,” the report concludes.

While highlighting the plight of the “new poor” resulting from austerity measures, the Red Cross also underscores how employment levels may not always be indicative of any standard of living in themselves. The institution cites a 2011 Eurostat figure, noting that 8.9 percent of people with jobs in the EU still lived below the poverty line.