Poverty shoots up 37% in Madrid and 35% in Barcelona if the cost of living is taken into account
Cars of families who come to collect food at an NGO in the Raval neighborhood of Barcelona, ​​in April 2021.
Cars of families who come to collect food at an NGO in the Raval neighborhood of Barcelona, ​​in April 2021.Quique Garcia / EFE

Living in a big city is usually more expensive and reduces the income of its inhabitants compared to other cities where the cost of living is lower. It was measured last year by the Institute of Regional and Metropolitan Studies of Barcelona (IERMB), which showed that living in Madrid or Barcelona is 23% and 21% more expensive than in the whole of Spain. In a second edition of the study, the IERMB has given a twist and has estimated how the drop in income caused by the cost of living increases the number of citizens at risk of poverty. Making this calculation, poverty skyrockets in the city of Madrid (37%, 208,000 more people) and in Barcelona (35%, 87,500 people).

If the focus is extended to the autonomous communities, in Madrid poverty grows by 44% (434,000 more people) and in Catalonia by 14% (150,000 more people). In the Basque Country poverty is also growing, according to the report: 15%; and in the Balearic Islands, 25%. And on the other hand, in the rest of the autonomous communities, where the cost of living is lower, poverty would fall according to this calculation and in percentages that range between 33% in Murcia and 2.9% in Asturias. The authors, from several universities, consider that these data should be taken into account when designing public policies such as aid.

Study authors Cost of living and risk of poverty in the autonomous communities, metropolitan areas and Spanish cities They explain that it is the first time that this calculation has been made in Spain, an unofficial indicator although it is based on data from the National Institute of Statistics: the available family income and the risk of poverty for 2018, the last available. “We estimated the differences from the best available data. Our intention is not to replace official statistics, we are interested in showing that the difference can be measured and the data can be useful when designing public policies such as salaries or aid”, explains Vittorio Galletto, economist and researcher at the IERMB and one of the signatories of the report. He although he warns: “Introducing salaries by territories can be a bias that is not politically interesting.”

Galletto also points to the hypothesis that with the current inflation and after the crisis generated by the pandemic “it is foreseeable that the gap between income and cost of living has increased and we have become more impoverished.”

The link between income, cost of living (in which the IERMB calculation method takes into account housing, another issue that the Institute has studied) and poverty is studied in the United States, adds Galletto. And in Europe, the Parliament invited the states to do so in 2007. In addition to this economist, the study is signed by Àlex Costa, from the Barcelona City Council, Jaume García from the Pompeu Fabra University, Josep Lluís Raymond from the Autonomous University of Barcelona and Daniel Sánchez -Serra, linked to the OECD but in this case signing it individually.

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The report also analyzes large urban areas. Once again, where poverty grows the most when compared to disposable family income, it is in Madrid and Barcelona. Another notable increase is that of San Sebastián (20.61% more and 23,190 people at risk of poverty). Above a 10% increase in risk of poverty are the cities of Bilbao, Cádiz, Girona, Santander, Seville and Vigo.

In contrast, among the cities where poverty falls according to the IERMB study, Aloi and Lorca (-25%) or Linares (-21%) stand out. Other cities where the decrease in poverty is significant, above 10%, are Cartagena, Castellón, Elx, Ferrol, Gandia, Sagunt, Jerez, Murcia and Zamora.

The director of the IERMB, Ricard Gomà, highlights above all the figures that point to growth in poverty. “150,000 people in Catalonia or 434,000 in Madrid are very relevant, they are not minor amounts.” “What we put on the months is whether aid or wages should be altered: we cannot think that it is not relevant from the point of view of the relationship between prices, income and poverty.” Policies must be challenged.

Beyond the variability of calculating poverty from disposable income and the cost of living in each territory, the new IERMB study reiterates last year’s exercise of pointing out the cost of living in large cities and communities. The work indicates that the prices of the central cities are higher than those of their urban area and, in turn, the urban areas have prices higher than those of their autonomous community. The greatest differentials between the prices of a community and its central city are observed in Castilla – La Mancha. And the smallest figure in the Balearic Islands.

Barcelona presents one of the highest price indicators (121 over an average value for Spain of 100). That of Madrid is even higher: 125. This means that buying the same basket of products is 21% and 25% more expensive in Barcelona and Madrid than in the rest of Spain.

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