The Survey on Income and Living Conditions is conducted in 2017 for the first time in Albania where the reference income is 2016. For release of 2022, the reference income is 2021.

The results present comparable statistics to other countries as well as provide reliable data in the area of relative poverty, social exclusion and household income, helping policymakers in the policies designing for reducing poverty. Until 2012, the only source for measuring living conditions. absolute poverty and well-being of Albanian households was the Living Standard Measurement Survey known as LSMS. This survey has collected a variety of monetary and non-monetary indicators bringing a variety of information to different users. Through LSMS, the measurement of poverty is based on consumption using the absolute poverty line, while SILC is based on household income using the relative poverty line.

Based on these methodological changes used in these two surveys, it is expected that the information from Income and Living Conditions Survey will be different, compared to the data provided by the Living Standard Measurement Survey.

Coverage: EU-SILC Survey covers all households of the Republic of Albania territory regardless of their size or socio-economic characteristics.

Excluded from the survey: Population living in institutional households of all types (dormitories. elderly homes. hospitals. prisons. rehabilitation centers. camps. etc.).

Household concept: is referred to a group of persons or a person related by blood or not, who live together in the same dwelling or in a part of the house and share a partial or common economy.

Sample size: In 2022, the survey was conducted on a sample size of 9.103 households, where respondent households were 7.382, while in 2021 the sample size was 9.136 households with 7.692 households respondent.

Reference period: is different depending on types of information collected:

Incomes: is the last calendar year - N - 1 (for SILC 2022 is 2021, for SILC 2021 is 2020, for SILC 2020 is 2019 and for SILC 2019 is 2018).

 Material deprivation: is the moment when the interview is conducted - (Year 2022, 2021, 2020 and 2019).

According to the methodology for measuring poverty, the poverty line is calculated based on its relative concept (poor in relation to others) and is defined at 60% of the median total equivalised disposable household income, using the modified OECD equivalised scale. Total equivalised disposable income of the household is considered the total net income (that is. income after taxes and social contributions) received by all household members.

Equivalised income:

As equivalised disposable income of the individual is considered the total disposable income of household after being divided by the modified OECD equivalised scale. In the income distribution per person each household member possesses the same amount of income, corresponding to the equivalent disposable income of the household. This means that each member of the household enjoys the same level of living. Consequently. in the income distribution per person, the income that is attributed to each person does not represent wages, but actually, an indicator of the level of living.

 Equivalence scale

Equivalent size refers to the OECD modified scale which gives a weight of 1.0 to the first adult (over 14 years old). 0.5 to other persons aged 14 or over who are living in the household and 0.3 to each child aged under 14. Example: The income of household with two adults and two children under 14 years is divided with a weight 1+0.5+2*0.3= 2.1, for household with two adults is 1 + 0.5 = 1.5. etc.

The indicators of at risk of poverty and social exclusion are based on the concept of relative poverty, which takes into account household disposable income, the number of household members, and income distribution of the total population.

The main indicator definitions:

At-risk-of-poverty threshold represents the lowest annual disposable income for a person to not be considered in at risk of poverty. At-risk-of-poverty threshold is defined as 60% of the median equivalised disposable income for all households.

At-risk-of-poverty rate indicates the percentage of persons living in households where equivalent disposable income is below the at-risk-of-poverty threshold.

Material deprivation indicates the population standard of living by the material deprivation rate.

Severe materially deprived persons (Europe 2020) are those living in household who cannot financially afford at least four out of nine categories of material deprivation related to assets, living conditions or financial aspects.

The nine items of material deprivation based on Europe 2020 strategy are described as below:

1. Arrears on mortgage or rent utility bills. hire purchase instalments or other loan payments;
2. Capacity to afford paying for one week's annual holiday away from home;
3. Capacity to afford a meal with meat. chicken fish (or vegetarian equivalent) every second day;
4. Capacity to face unexpected but necessary expenses of 30.000 ALL;
5. Household cannot afford a telephone (including mobile phone);
6. Household cannot afford a color TV;
7. Household cannot afford a washing machine;
8. Household cannot afford a car and
9. Capacity to afford keeping home adequately

Severe Material and Social Deprivation (Europe 2030) represent the percentage of the population who

cannot financially afford at least 7 out of 13 deprivation items (6 items related to the individual and 7 items

related to the household).

List of items at household level:

1. Capacity to being confronted with payment arrears (on mortgage or rental payments, utility bills, hire purchase installments or other loan payments);
2. Capacity to afford paying for one-week annual holiday away from home;
3. Capacity to face unexpected expenses of 30.000 ALL;
4. Capacity to afford a meal with meat, chicken, fish or vegetarian equivalent every second day;
5. Ability to keep home adequately warm;
6. Have access to a car/van for personal use;
7. Replacing worn-out furniture.

List of items at individual level:

1. Having internet connection;
2. Replacing worn-out clothes by some new ones;
3. Having two pairs of properly fitting shoes (including a pair of all-weather shoes);
4. Spending a small amount of money each week on him/herself;
5. Having regular leisure activities;
6. Getting together with friends/family for a drink/meal at least once a month.

The work intensity of the household is defined as the ratio of the number of months that all household members have been working during the income reference year to the total number of months that could have theoretically worked during the same period (12 months).

A person of working age is considered to be a person of the age group 18-59 years according to the Europe 2020 and of the age group 18-64 years according to the Europe 2030 objectives, excluding persons belonging to the age group 18-24 years who are dependent and economically inactive as well as the exception of persons receiving family pension and inactive persons aged 60-64 living in households in which the main source of income is pension.

The work intensity is: very low (0 %- 20 %). low (20 % - 45 %). medium (45 % - 55 %). high (55 % -85 %) and very high (85 % - 100 %).

Very low work intensity refers to the situation of persons in the household where no one works, or works very little, meaning that working-age household members work only 20% or less of the total number of months they can work during the reference period.

At Risk of Poverty or Social Exclusion refers to the individuals who are at risk of poverty or severe   materially and socially deprived or living in a household with very low work intensity.

The table below shows the differences between the At-risk-of-poverty or social exclusion rate (AROPE) defined for the Europe 2020 strategy and the Europe 2030 targets.