A new Taub Center study: which basic necessities low-income Israeli families forego?
September 22, 2014
A new Taub Center study examines which basic necessities low-income Israeli families forego and the additional money such families would need to spend to avoid food insecurity
- Average monthly spending per person on food in Israel is about NIS 700, of which about NIS 660 is considered normative (i.e., the standard level of spending needed to fulfill household food needs).
- An average Israeli in the lowest income decile needs NIS 192 more per month to reach the normative spending level, while a person in the second lowest income decile needs an extra NIS 99 per month.
- Low-income families spend close to the normative amount on meat and chicken, bread and grains, and oil/fats, but cut back on eggs, dairy, and especially fresh fruits and vegetables.
Every year, as the Jewish New Year approaches, the issue of food insecurity rises to the top of the public agenda. According to figures from the National Insurance Institute, about 320,000 households in Israel – nearly a million people – suffer from food insecurity. A new study by Prof. Dov Chernichovsky and Eitan Regev, to be published in the Taub Center’s upcoming State of the Nation Report 2014, examines the average per person spending on food and establishes a normative level of food spending in Israel (i.e., the standard level of spending needed to fulfill household food needs). The researchers also examined the types of food that low income households forego.
Chernichovsky and Regev found that an average Israeli spends about NIS 700 per month on food, which represents 17% of household income and 21% of household expenditures. Fruit and vegetables account for the largest share (18%) of the household food budget, followed by meat and chicken at 16% (Figure 1).
The Taub Center study also examined how changes in income or household size affect food spending. There are certain staples for which spending is minimally influenced by changes in income, but is greatly influenced by the number of people in the household. In other words, even as income drops, expenses for such items remain relatively steady, and even a household with fewer resources would have difficulty foregoing these items. The items determined to be most essential for Israeli households are meat and chicken, bread and grains, and oil/fats. Items considered “somewhat necessary” include dairy items and eggs, fish, and fruits and vegetables. Thus, as income declines, households are more likely to forego purchasing “somewhat necessary” products (e.g., dairy, fish and vegetables), and to maintain spending on meat and chicken, bread products, and oil.
Chernichovsky and Regev concluded that out of an average monthly per person food expenditure of nearly NIS 700, about NIS 660 is considered “normative spending.” This classification is based on the broad income range for which food spending remains relatively stable and fixed (the green bars in Figure 2). The study found that in the lowest and second lowest income deciles, monthly per person spending on food is lower than the normative amount by NIS 192 and NIS 99, respectively.
The Taub Center study also determined the “normative expenditure” for different food groups (Table 1). Groups with the highest normative spending include fruits and vegetables (NIS 137), meat and chicken (NIS 110), and dairy and eggs (NIS 101). The study found that households in the lowest income decile have difficulty affording meat and chicken, and their spending on these items is 25% lower than the normative expenditure. Moreover, the second income decile spends 22% less and the lowest income decile spends 29% less than the normative expenditure level on dairy and eggs. The foregone amount of spending on fruits and vegetables was even larger. The second lowest income decile has a shortfall of NIS 25 (18% of the normative expenditure) while the lowest income decile has a shortfall of NIS 48 (35% of the normative expenditure) in terms of fruit and vegetable consumption. The picture that emerges suggests a substantial shortage of these food groups for the lower deciles.
Chernichovsky concludes: “The patterns of food spending by Israeli households are not surprising: the burden of food expenditures is greater as per person income declines. Nevertheless, there are surprising and important findings on the type of food items that poor families forego. For example, it is concerning that spending on fruits and vegetables and to some extent, also on dairy products, follows the same pattern as spending for luxury items. As such, a decline in income is likely to result in not only a lack of food, but also a reduction in nutritional quality.” Regev adds: “Policymakers must formulate policies to relieve the distress of households whose ability to purchase food necessities falls below what is considered the norm.”
The Taub Center for Social Policy Studies in Israel, headed by Professor Dan Ben-David, is an independent, non-partisan institution for socioeconomic research based in Jerusalem. The Center provides decision makers, as well as the public in general, with a big picture perspective on economic and social areas. The Center’s interdisciplinary Policy Programs – comprising leading academic and policy making experts – as well as the Center’s professional staff conduct research and provide policy recommendations in the key socioeconomic issues confronting the State.
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