Poverty rates and inequality reach record highs

Unprecedented in at least thirty years: the poverty rate hit a record high in 2023 in metropolitan France, where inequality is widening, according to INSEE. These figures are far from "surprising" for associations, which are urging the government to take action.

Between 2022 and 2023, the poverty rate increased by 0.9 percentage points, from 14.4% to 15.4%, the National Institute of Statistics and Economic Studies stated in its annual study published Monday. This is the highest rate since the INSEE indicator was launched in 1996.

Concretely, 9.8 million people were in a situation of monetary poverty in 2023, meaning they had monthly incomes below the poverty line, set at 60% of the median income, or €1,288 for a single person. In one year, 650,000 people fell into poverty. "This is a level not seen in nearly 30 years," notes Michel Duée, head of the Household Resources and Living Conditions Department at INSEE. "If we want to go back even further, we have to go back to the early 1970s to see roughly comparable poverty levels."

"This increase is explained by the cessation of exceptional aid, in particular the inflation allowance and the exceptional back-to-school bonus, which had been put in place in 2022 to support purchasing power," he adds. "The other element of explanation is the increase, among the self-employed, in the share of micro-entrepreneurs with low incomes." Inequalities in living standards also "sharply" increased in 2023, a consequence of the decline in the standard of living of the poorest people concomitant with the rise in that of the wealthiest.

"Inequality is reaching some of the highest levels in 30 years," notes Michel Duée. "The standard of living of the poorest has increased less rapidly than inflation, while the standard of living of the wealthiest has been dynamic, notably thanks to the good situation on the labor market and the performance of financial products."

The profile of poor people remains broadly unchanged, with a strong representation of single-parent families – whose poverty rate increased by 2.9 points – and unemployed people, up by 0.8 points. Another finding from the INSEE study is a less marked increase in poverty among retirees (11.1%, +0.3 points compared to +0.9 points for the population as a whole), notably due to the increase in the minimum contribution planned as part of the pension reform.

"Electricity and gas cutoffs due to non-payment are exploding, the number of people reporting cold at home has nearly doubled, and we're seeing a sharp rise in rental evictions," emphasizes Manuel Domergue, the Foundation's director of studies. "We're seeing a very worrying trend in political action, or rather, political inaction," he adds. "The time for one-off measures is over; we need structural measures."

The INSEE's annual poverty study does not include residents of overseas departments, the homeless, or people living in institutions. The last survey conducted on the entire French population estimated the number of people living in poverty at 11.2 million in 2021.