Gauging poverty and its impacts

Poverty rates in Egypt have been steadily rising in recent years. This upward trajectory is evident in the latest official figures, which show the proportion of the population living in poverty increasing from 25.2% in the 2010–2011 Income, Expenditure, and Consumption Survey to approximately 30% in 2020.

While the Central Agency for Public Mobilization and Statistics/CAPMAS has not released updated poverty data for the past five years, a CAPMAS expert recently estimated that the rate continued its upward trend, reaching 35.7% in 2023.

In the absence of updated statistics, we will attempt to gauge the extent of poverty in Egypt under the pressure of recent inflationary policies. It will also examine the structural features that make poverty inescapable for many Egyptians over the long term.

Below the poverty line

While we lack the means to conduct a national survey of household income and expenditure akin to those produced by CAPMAS, we can recalculate the poverty line using the exchange rate of the US dollar, which has undergone three major devaluations since the last official poverty figures were released.

The dramatic devaluation of the Egyptian pound has fundamentally reshaped the country's poverty thresholds. In 2019/20, a four-person household was considered poor if its monthly income fell below 3,428 Egyptian pounds, with extreme poverty set at 2,200 pounds. These figures, however, are now starkly outdated.

With the pound's value plummeting from 15.7 per dollar in 2020 to 50.5 by 2025, the national poverty line has surged. A family of four now requires approximately 11,000 pounds monthly to avoid poverty, while the extreme poverty line for a family has similarly risen to over 7,000 pounds.

What do these numbers mean?

A significant segment of the population now falls below the poverty line. Notably, the extreme poverty line for a family surpasses the current minimum wage. This means a large share of wage earners—not just the unemployed or those begging on the streets—are classified as “extremely poor,” struggling daily just to feed themselves.

Profiles of Egypt’s poor

Data from Egypt’s two most recent household income and expenditure surveys show recurring patterns in how poverty manifests.

One is the concentration of poverty in rural Upper Egypt, where poverty rates reach around 43%. This highlights the uneven geographic distribution of public investment and social protection programs, which perpetuates poverty in the region as long as such imbalances persist.

Another recurring trend is the spread of poverty among the educated. Poverty affects 9.4% of those with university degrees or higher, indicating either a need to reform educational policy to create better-paying jobs for graduates or that the labor market pays low wages even to highly educated individuals, rendering them among the working poor.

While poverty exists among university graduates, it disproportionately affects the less educated. The highest poverty rate, 35.6%, is found among the illiterate, highlighting a profound need for education reform.

Beyond educational disparities, an urgent need exists to reform private-sector labor policy, as over 80% of poor workers are employed in that sector.

Another well-documented pattern is the high rate of poverty among female-headed households, pointing to the need for policies specifically aimed at supporting women breadwinners.

The Takaful and Karama cash assistance programs, designed to support women, are undermined by the low value of their payments. With average monthly support per household at just 900 pounds ($17.80), can this amount truly offer real social protection given current poverty thresholds, rampant inflation, and rising prices?

What about the poor children?

The pervasive nature of poverty is closely linked to school dropout rates. This issue carries significant long-term consequences for both individuals and society, and effectively tackling it demands a deeper understanding and resolution of its root causes.

CAPMAS data reveals alarming school dropout rates in primary and middle-years education, disaggregated by gender across the country. Around 150,000 students dropped out during the reporting period: 28,000 at the primary level and 121,000 during middle years.

Although the causes of school dropout are numerous and complex, poverty consistently emerges as the common thread. Financial hardship, for instance, often compels families to marry off daughters early or pull children from school to put them to work. 

This pours directly into the issue of child labor. A June 2023 study published by the Egyptian Population and Family Planning Review underscored poverty as a primary driver, revealing that children from poor households are significantly more likely to enter the workforce. It further found that older children and those in rural areas are more prone to working than their urban counterparts.

In sum, poverty often perpetuates itself. Combating it requires starting with detailed, up-to-date data on Egyptian household income, followed by a serious effort to identify and address its root causes.