‘In Switzerland, around 1.4 million people are at risk of poverty,’ or ‘One in ten struggles to make ends meet’. Headlines like these sound alarming, but they only show part of the picture. Poverty in Switzerland is a complex phenomenon that cannot be reduced to a single number or a simple cause. Three key questions help paint a clearer picture.
1. How does one define poverty?
There are different types of poverty. In research, a distinction is usually made between absolute and relative poverty.
- Absolute poverty means that a person can no longer meet their basic needs such as food or medical care. In Switzerland, this definition is based on the social minimum subsistence , which is designed to allow for minimal participation in society as well. Even though the term absolute poverty is used, Switzerland’s definition already leans toward the concept of relative poverty (see below), since the social minimum subsistence includes more than just physical survival.
According to the Swiss Federal Statistical Office (FSO), a person is considered poor if they have less than 2,315 Swiss francs per month (for a single person). For a family of four, the threshold is 4,051 francs. This amount must cover everyday expenses like food, transportation, and housing, but not health insurance premiums, social security contributions, or taxes. As a result, the poverty line in terms of gross income is somewhat higher: around 3,000 francs for a single person. Based on this definition, about 8.1 percent of the population — or around 700,000 people — are considered poor.
- Relative poverty, by contrast, describes a financial situation compared to the typical income level of a country. It is measured using what is known as equivalized disposable income. The starting point is a household’s gross income, from which taxes, social security contributions, and health insurance premiums are deducted. The remaining income is then adjusted using an equivalence scale to account for household size.
A person is considered relatively poor or at risk of poverty if they have less than 60 percent of the median equivalized income. In Switzerland, this threshold is currently 2,599 francs for a single person and 5,457 francs for a family of four (using a factor of 2.1). According to this measure, about one in six people (16.1 percent) is considered at risk of poverty. These individuals typically still manage to get by, but they have significantly less financial flexibility compared to the average.
The political debate often rests on the concept of relative poverty. The flip side: if poverty is relative, there will always be poor people, even if almost no one suffers from material deprivation anymore. Relative poverty remains unchanged if all incomes rise equally. Fighting it thus turns into a kind of political perpetual motion. Poverty then becomes a question of inequality.
2. How poor is Switzerland?
Anyone seeking to understand poverty in Switzerland should therefore focus on the figures regarding absolute poverty. Certain groups such as people over the age of 65, single parents, individuals without higher education, and those with foreign citizenship are disproportionately affected. However, a closer look at the statistics reveals that reality is more nuanced than the numbers alone suggest. The following points are crucial:
- Poverty is often temporary
Political debates about poverty often suggest that people remain stuck in low-income brackets, or in poverty, for life. However, only 1.5 percent of the population was continuously affected by poverty between 2020 and 2023. For the majority, poverty is a temporary situation, triggered, for example, by job loss or separation. In addition to state support, many households can bridge income losses with savings or help from family and friends. This matters because long-term poverty is far more burdensome, both for individuals and for society as a whole. - Poverty among seniors: Not always synonymous with material deprivation
When measuring poverty, wealth is not taken into account (although capital income is). Many retirees who fall below the poverty line nonetheless have savings or are homeowners. While the official poverty rate among those over 65 is 15 percent, only 4 percent of seniors report being dissatisfied with their financial situation. It would therefore be more accurate to speak of income poverty. - Poverty is closely linked to unemployment
The single most important dividing line is participation in the labor market: Three-quarters of those affected by poverty are not employed. Among employed individuals, the poverty rate is 4.4 percent; among the non-employed, it rises to 15.4 percent. In other words, being employed reduces the risk of poverty by around three-quarters. Among full-time workers, the poverty rate is even lower, at just 2.8 percent. That said, poverty can still occur even among full-time workers, particularly in low-wage jobs where the income may be sufficient for a single person but not for a family with children. It’s also worth noting that the statistics on poverty include people in temporary situations, such as internships, whose financial hardship is often neither severe nor long-term.
3. What helps against poverty?
Poverty is not just a statistic. It has a massive impact on people’s lives. This is precisely why a brief glance at today’s widespread statistics falls short. Instead of targeted measures, we end up with an inefficient scattergun approach. This is something that is unfortunately often witnessed in everyday politics.
Many political demands such as minimum wages, broad-based premium subsidies, or the construction of affordable housing often have little to do with directly combating poverty. They tend to benefit large segments of the population, including much of the middle class. As a result, those who are truly in need are often left behind. More effective are social transfers based on needs and that specifically target people facing hardship.
What is also lacking in Switzerland is knowledge about who is affected by long-term poverty and why. Such insights would be crucial to better target support measures. The longer someone remains in poverty, the harder it becomes to escape it, often because long-term poverty goes hand in hand with reduced employability.
Employment is the most effective lever in the fight against poverty. The key lies in integrating affected individuals into the labor market and ensuring their access to education. Measures such as minimum wages, on the other hand, can sometimes be counterproductive as they may make it harder for people with low qualifications or a patchy employment history to enter the workforce.
It may sound paradoxical, but a liberal labor market actually creates more opportunities for ‘at-risk’ applicants, because employers can respond more flexibly and hire with lower costs and risks. At the same time, social benefits should be designed in such a way that employment always remains financially more attractive than relying on welfare.
One thing remains clear: In one of the wealthiest countries in the world, no one should have to live in dire poverty. However, the statistical phenomenon of poverty will never be fully eradicated, even in Switzerland. There will always be people falling below the poverty line, such as students on tight budgets or individuals in temporary hardship who choose not to seek social assistance . What matters is that financial hardship is not perceived as a permanent and unbearable condition and that both the state and society provide support specifically where it is truly needed.
