Andorra Sees Purchasing Power Rise, Poverty Drop in 2025 Survey

Andorra's 2025 living conditions survey, drawing on 2024 data, indicates rising household incomes and falling poverty rates, alongside some increases in material deprivation and inequality.

The Department of Statistics' Enquesta de Condicions de Vida recorded average equivalent disposable income per consumption unit at €41,085, up 10% from €37,335 the prior year. The median income rose 2.2% to €29,505. These gains exceeded the 2024 consumer price index increase of 2.7%. Economy, Presidency, Employment and Housing Minister Conxita Marsol linked the progress to policies such as minimum wage rises above inflation and free public transport, which have bolstered purchasing power and eased housing cost pressures.

Poverty rates continued to decline. The at-risk-of-poverty rate—below 60% of median income, or €17,703—dropped 3.1 percentage points to 13.3% from 16.4%. Relative poverty (under 50% of median, €14,752) fell to 7.7% from 8.8%, while severe poverty (below 40%, €11,802) eased to 4% from 4.2%.

Housing indicators showed modest gains. Homeownership rose 2.7 points to 38.6%, with renters dropping to 61.4% from 64.1%. The share of renters facing housing cost overburden—spending over 40% of income on housing—slipped to 12.7% from 13%. Overall, housing cost overburden affected 8.7% of the population, down from 9.4%.

Income inequality presented mixed results. The S80/S20 ratio, pitting the top 20% earners against the bottom 20%, improved from 7.1 to 6.6. Yet the Gini coefficient climbed from 38.4 to 40.2, signaling greater unevenness in income distribution. Without social benefits or pensions, the Gini reached 49.1.

Challenges persisted in other areas. Severe material deprivation, gauging inability to afford at least four of nine essentials, climbed to 7.3% from 5%. The AROPE rate—combining poverty risk, severe deprivation, and low work intensity—edged up to 19.8%, nearly one in five people. Those making ends meet easily fell to 66.6% from 68.6%.

Single-adult households with dependents faced the highest risks: 37.1% at poverty risk, 18% in severe deprivation, and 62.1% struggling to cover monthly expenses.

Andorra's poverty threshold of €17,703 tops those in neighbouring Spain (€13,445) and France (€14,275). Applying local metrics, Andorra's 13.3% at-risk rate remains below Spain's 19.5% and France's 16.3%.