Poverty incidence drops to 16.6% in 2018 — PSA

MANILA, Philippines — The proportion of poor Filipinos, or those not earning enough to meet basic food and non-food needs, dropped significantly in 2018 despite the upward adjustment in the poverty thresholds, the Philippine Statistics Authority (PSA) reported yesterday. 

Its parent agency, the National Economic and Development Authority (NEDA), attributed this to increased job creation as well as ongoing government efforts to reduce inequality. 

Poverty incidence, pertaining to the proportion of Filipinos whose per capita income is not enough to meet basic food and non-food needs, fell to 16.6 percent in 2018 from the revised 23.3 percent in 2015. 

This translates to 17.6 million Filipinos living below the poverty threshold of P10,727 monthly for a family of five in 2018. This is the minimum income needed to satisfy basic food and non-food needs. 

The poverty threshold was pegged at P9,452 in 2015 during which 23.5 million Filipinos live below this. 

The higher poverty threshold in 2018 was largely caused by the surge in inflation last year. 

Subsistence incidence among Filipinos, or the proportion of the population whose incomes were not enough to satisfy even the basic food needs, also fell to 5.2 percent in 2018 assuming a monthly food threshold of P7,528 for a family of five on the average. 

This is an improvement from the subsistence incidence of 9.1 percent in 2015 assuming a food threshold of P6, 605 monthly for a family of five. 

Among families, the proportion of households living below the poverty threshold was estimated at 12.1 percent, equivalent to three million families. In 2015, this was estimated at 17.9 percent.

The proportion of households that fall under the subsistence incidence, meanwhile, was recorded at 3.4 percent, or around 800,000 families that were considered food poor in 2018. This was estimated at 6.4 percent in 2015. 

“Poverty incidence further dropping tells us that we are on track in meeting our targets under the Philippine Development Plan 2017-2022,” said NEDA Undersecretary Adoracion Navarro, noting the country intends to bring down poverty incidence to 14 percent by 2022. 

As such, poverty incidence must be reduced by one percentage point every year to reach this goal. 

“We want to make as much headway as we can,” said Edillon.

In 2018, poverty incidence among families was lowest in the National Capital Region (NCR) and was well below the national average at 1.5 percent, while it was highest in ARMM where this was estimated at 53.6 percent. 

Navarro attributed the reduction in the nationwide poverty incidence to the creation of more jobs and the increase in mean salaries and wages by 22.8 percent in 2018. 

Likewise, the expansion of the government’s social assistance programs such as social pension and cash transfers helped bring down the poverty line

“Given this, the government needs to be consistent in its robust poverty reduction efforts, especially in accelerating human capital development and expanding economic opportunities to hasten reduction in poverty and inequality across all regions in the country,” Navarro said. 

In 2018, Filipino families earned P313,000 annually on average. In comparison, their expenditure for the same year was P239,000 on average. As such, Filipino families save an average of P75,000 annually.