Brazil concluded 2023 with the lowest poverty and extreme poverty levels recorded since the Synthesis of Social Indicators survey began in 2012, conducted by the government´s statistics agency IBGE. However, despite this improvement, data released on Wednesday in December revealed that 58.9 million people still live in poverty, with 9.5 million in extreme poverty.
The study focuses on monetary poverty, defined as a family lacking sufficient income to ensure its well-being. To establish the poverty thresholds, IBGE applied the World Bank’s criteria: $2.15 per person per day for extreme poverty and $6.85 per person per day for general poverty.
In 2023, the proportion of the population living in extreme poverty fell to 4.4 percent, down from 6.6 percent in 2012 and 5.9 percent in 2022. Between the last two years of the survey, 3.1 million people moved out of extreme poverty, gaining access to an income of at least $2.15 per day.
The proportion of the population living in poverty, defined as earning less than $6.85 per day, dropped to 27.4 percent in 2023, compared to 34.7 percent in 2012 and 31.6 percent in 2022. Between 2022 and 2023, 8.7 million people moved out of poverty.
Employment and income
IBGE researcher Bruno Mandelli Perez attributes the reductions in poverty and extreme poverty to two key factors: improved employment opportunities and social benefits, including income transfer programs targeting socially vulnerable families, the elderly, and individuals with disabilities.
“Both the labor market and social program benefits play a key role in reducing poverty. However, the labor market has a greater impact on poverty reduction, while social program benefits are more significant in addressing extreme poverty,” he explains.
“The increase in the average value of the benefits granted…certainly had an impact on maintaining the trajectory of reducing poverty and extreme poverty in 2023,” the Synthesis of Social Indicators points out.
Women, black, and young individuals
IBGE highlights that women, black individuals, and young people are the most affected by poverty and extreme poverty.
The proportion of men in poverty is 26.3 percent, compared to 28.4 percent for women. For extreme poverty, the figures are 4.3 percent and 4.5 percent, respectively.
By race, 17.7 percent of white individuals live in poverty. This proportion nearly doubles among brown individuals, reaching 35.5 percent, and stands at 30.8 percent among black individuals.
When examining extreme poverty, 2.6 percent of white individuals fall below this threshold, compared to 6 percent of brown individuals and 4.7 percent of black individuals.
When analyzed by age group, the youth population shows poverty rates exceeding the national average of 27.4 percent. Among individuals aged 15 and under, the rate is 44.8 percent, while for those between 15 and 29 years old, it stands at 29.9 percent.
Researcher Bruno Perez highlights that poverty and extreme poverty rates are lower among individuals aged 60 and older, at 11.3 percent and 2 percent, respectively.
“This group is generally covered by pension benefits, with incomes linked to the minimum wage,” he explains.
Social benefits
The Synthesis of Social Indicators provides data that shows the importance of social benefits for the poorest population. In 2023, employment income was the main source of household earnings, accounting for BRL 74.20 out of every BRL 100.
Among families with the lowest incomes—those earning up to a quarter of the minimum wage per person—social benefits constituted the majority of their income. For every BRL 100, BRL 57.10 came from benefits, exceeding the BRL 34.60 derived from work.
When the survey started in 2012, social benefits made up only 23.5 percent of the household income of the poorest families. A decade later, this proportion has increased to 42.2 percent.
“Among households with the lowest income, those earning up to a quarter of the minimum wage, the share of income from work is decreasing, while the share from social program benefits is increasing,” Perez points out.
The researcher presented a simulation showing the impact of income transfer programs on poverty and extreme poverty. Without these programs, extreme poverty would rise from 4.4 to 11.2 percent, and poverty would increase from 27.4 to 32.4 percent.
Inequality
In 2023, the Gini index, which measures income inequality, stood at 0.518, the same as in 2022 and the lowest recorded since 2012. The Gini index ranges from 0 to 1, with values closer to zero indicating lower inequality. The highest level of inequality in the series occurred in 2018, with a score of 0.545.
According to IBGE, without income transfer programs, the 2023 Gini index would have been 0.555.
Source: Agência Brasil