News World Sharpest drop of household real consumption per capita in both euro area...

Sharpest drop of household real consumption per capita in both euro area and EU

In the first quarter of 2020, when Member States began to widely introduce Covid-19 containment measures in March 2020, household real consumption per capita dropped by 3% in the euro area, after a decrease of 0.4% in the previous quarter, according to data released today by Eurostat.

This decline is the highest since the beginning of the time series in 1999.

Household real income per capita increased in the first quarter of 2020 by 1.1% following a decrease of 1.1% in the fourth quarter of 2019.

In the EU, household real consumption per capita decreased by 2.9% in the first quarter of 2020, after a decrease of 0.2% in the previous quarter. This decline is the highest since the beginning of the time series in 1999.

Household real income per capita increased by 1.2% in the first quarter of 2020, after a decrease of 1.0% in the fourth quarter of 2019.

During the first quarter of 2020, household gross disposable income increased by 0.9% in the euro area and by 1.2% in the EU.

The reduction in current taxes and net social contributions had a strong positive contribution to gross disposable income while the contribution of social benefits was higher than usual.

The decrease observed in received wages, operating gross, operating surplus and mixed income of households contributed negatively in the growth of gross disposable income in both zones.

In the first quarter of 2020, the saving rate increased in both the euro area and the EU by 4.3 percentage points, compared to the fourth quarter of 2019.

The household saving rate increased in all Member States for which data are available for the first quarter of 2020.

The highest increases were observed in Belgium, Denmark and the Netherlands, and the lowest in Poland, Sweden and the Czech Republic.

For all but two Member States the increase of the saving rate was explained by the strong decrease of individual consumption expenditure.

The drop in the individual consumption expenditure of households was the most pronounced in Italy, Spain and Belgium, followed by France.

At the same time, the gross disposable income varied, increasing in Poland, Denmark, the Czech Republic, Ireland, the Netherlands and Finland and decreasing in Spain, Italy, Portugal, Germany and Austria.

In the first quarter of 2020 the investment rate decreased by 0.2 percentage points for the euro area and 0.3 percentage points in the EU.

Amongst the Member States for which data are available for the first quarter of 2020, the decrease in investment rate of households was the highest in Spain, France and Belgium.

Seven Member States recorded an increase in the household investment rate, the highest being observed in Germany, the Netherlands and Denmark.

Data for households are not available for Member States whose gross domestic product at current prices is less than 1% of the corresponding EU total GDP.

Source: Eurostat/CNA

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