On household consumption expenditure in 2008

16.07.2009

Central Statistical Bureau Household Budget Survey results on consumption expenditure of private households1 witness that in 2008 their volume did not increase as rapid as during last years.

In 2008 household consumption expenditure on average per household member monthly reached LVL 232, which is by16% more than in 2007. If compared to 2007, in 2008 consumption expenditure growth has been rather similar both in urban and in rural areas.

Unlike previous years in 2008 consumption expenditure growth was due to increase of consumer prices, and their growth was only 0.4% at constant prices. It witnesses about rapid slow-down of consumption expenditure growth rate. Moreover, in the 4th quarter of 2008, compared to the previous quarter, consumption expenditure at current prices even has decreased by 6%.

Growth rate of household consumption expenditure and consumer price index (CPI)
as % of previous year


Consumption expenditure still is higher in urban households, where it reached LVL 253 per household member monthly (in Riga - LVL 285).

 

Household consumption expenditure (total in cash and in kind) in 2007 and 2008
average per household member monthly, LVL

 

All households

Urban

Riga

Rural

2008

232

253

285

188

2007

200

219

243

161

2008/2007 (%)

116

115

117

117


Structure of consumption expenditure in 2008, compared to 2007, almost has not changed which shows that there is a certain stagnation in this field. Main priority of the household consumption expenditure was food, and it is one of the internationally comparable material welfare indicators. In 2008 on average 25.6% of all consumption expenditure households spent on food. Share of this expenditure in consumption expenditure, compared to previous year, almost has not changed (25.5%). Growth of consumption expenditure on food in household consumption expenditure is always considered as negative fact. Expenditure on food has increased from LVL 51 to LVL 59 on average per household member monthly (increase by 16% at the time when inflation in this consumption expenditure segment reached 18%). Therefore, current expenditure at constant prices has slightly decreased.

Considerable share in consumption expenditure had expenses on transport (15%) and on housing2 (12%). Overall, on average in all households such main expenses as costs on food, housing, maintenance and utility costs, transport, clothing and footwear, and health constituted two thirds (65%) of total consumption expenditure. Compared to 2007 this expenditure has grown by 16%.

Structure of household consumption expenditure in 2008 (in per cent)


According to survey data the highest rate of the consumption expenditure was in households of Riga (LVL 285 per household member monthly) and of Pieriga region (LVL 253). In other regions the consumption expenditure per one household member was lower. The lowest were in Latgale where they did not exceed LVL 182 per household member monthly. When examining consumption expenditure within socio-economic groups, it may be concluded that, comparatively better situation was observed in households of entrepreneurs and self-employed, where consumption expenditure reached LVL 291 (on average per household member monthly), as well as, in households of wage and salary earners, where it was LVL 244.

Quintile groups3 are used to characterize the consumption expenditure in households of different income levels. One fifth or 20% of all households is represented in each of them. In 20% of the poorest households (1st quintile) the average consumption expenditure constituted 124 LVL per household member monthly. These households spent 35% on food, but on housing – 14% of their consumption expenditure. The consumption expenditure of 1st quintile households reached 53% of average household consumption expenditure level in the country. 24% of the total country population living in households lives in 20% of the poorest households. More than one third (37%) of the total number of children living in households lives in households of the 1st quintile. In 2008 the largest consumption expenditure growth was in 3rd quintile group (by 24%), but the lowest increase – in 1st and 5th quintile group (respectively, by 12% and 13% compared to 2007). But the consumption expenditure of 20% of the richest households (5th quintile) was LVL 419 per household member monthly; and that is 1.8 times above the average indicators.

Consumption expenditure in quintile groups in 2008
average per household member monthly, LVL

 

Household consumption expenditure (total in cash and in kind)
average per household member monthly

 

All households

Urban

Rural

2008, LVL

2008 over 2007, %

2008, LVL

2008 over 2007, %

2008, LVL

2008 over 2007, %

Consumption expenditure

232.06

116

252.78

115

187.57

117

Food and non-alcoholic beverages

59.33

116

61.17

116

55.38

116

Alcoholic beverages, tobacco

7.37

123

7.71

126

6.64

116

Clothing and footwear

18.04

104

20.08

104

13.64

106

Housing, water, electricity, gas and other fuels

27.61

135

32.21

132

17.74

148

Furnishings, household equipment and routine maintenance of the house

14.32

115

15.45

119

11.91

105

Health

11.06

113

12.24

115

8.54

108

Transport

33.98

109

34.78

106

32.25

119

Communications

10.77

104

11.82

103

8.51

106

Recreation and culture

19.34

118

22.13

119

13.34

114

Education

3.24

131

3.99

130

1.63

134

Hotels, cafes and Restaurants

12.83

110

15.00

109

8.17

111

Miscellaneous goods and services

14.17

126

16.20

125

9.83

129

 

Prepared by the Household Budget Statistics Section
Lidija Spārīte
Tel. 67366998

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1 A household is a person or a group of persons tied by relationship or other personal relation, who live together in the same dwelling and share expenditures.

2 Expenditures on housing: rent, payments for water, gas, fuel or other utility payments. 

3 Quintile groups are formed by arranging all households in ascending sequence by income per one household member and dividing them afterwards in five equal groups.