Understanding family spending through data analysis
Publication Date/Time
2024-01-11T10:09:00+00:00
Country
Europe
From an EU-wide perspective to the national and local trends in
household expenditures
This data story explores family spending by using official EU
bodies’ data. The analysis of family budgets reveals the
complexities involved in household financial decision-making and
identifies key trends in family spending. Each expenditure, whether on
necessities or discretionary items, contributes to understanding a
broader economic landscape by showing disparities across different
socioeconomic groups. 

Household expenditure indicators are essential components that offer
valuable insights into these trends. They belong to the
‘statistics’ category of high-value datasets
[https://data.europa.eu/en/publications/datastories/high-value-datasets-overview-through-visualisation]
established by the European Commission, for their role in benefiting
society and the economy. In this data story, we aim to explore various
datasets within this category, offering an EU-wide perspective.
Additionally, we will dive into national and local datasets to uncover
specific and detailed insights, providing a more nuanced understanding
of household spending patterns. 

 

THE HOUSEHOLD BUDGET SURVEY

The Eurostat Household Budget Survey (HBS)
[https://ec.europa.eu/eurostat/web/household-budget-surveys/overview]
is a vital tool for mapping how EU citizens spend their money. It
collects data on family expenses, broken down by categories of goods
or services bought.

The main goal of the survey is to understand the importance of
different items used to calculate the consumer price index, a key
metric for measuring inflation. However, the information from the
survey, such as how much households typically spend and what they
spend their money on, is also useful for economic studies and social
research. HBS data is gathered at the national level every 5 years
and then compiled and published by Eurostat, with the most recent data
being from 2020. 

The data gives a detailed look at what families buy, both in each EU
Member State and across the EU. It breaks down spending into different
categories, such as food and drinks, clothes and shoes, housing,
health, transport and communication. This classification allows for a
detailed analysis of spending habits and preferences across different
Member States, giving a nuanced understanding of how families allocate
their resources in various economic sectors.

From 1994 to 2015, family spending trends across various categories
showed distinct patterns. Notably, spending on housing, water,
electricity, gas and other fuels indicated a significant increasing
trend. In contrast, decreasing trends are found for alcoholic
beverages, tobacco and narcotics, and clothing and footwear. 

Changes were also observed in the communications category, where
spending increased, likely reflecting the rapid technological
advancements and increased adoption of communication services during
this period. These are average trends across multiple Member States,
but individual Member States may have shown unique trends for each
category. 

The following visualisation uses a HBS dataset to highlight some of
the changes in the composition of family spending in some Member
States from 1994 to 2015. Since data is not always available for every
Member State and year, only the Member States with the most extensive
time series are shown. Each category is shown as a percentage of the
total amount the family spends, giving a clear view of how they
distribute their budget across different types of products and
services.
[https://data.europa.eu/sites/default/files/img/media/13.spending6-01.png]
The HBS data also makes it possible to analyse the impact of the
COVID-19 pandemic on family spending in 2020. The pandemic
dramatically altered family lifestyles and spending habits, with
lockdowns, social distancing and economic uncertainties changing the
norm.

This information, highlighted in the following visualisation, shows
changes in spending priorities, such as increased expenditures on
home-related needs and decreased spending on travel and entertainment,
reflecting the pandemic’s direct effects.
[https://data.europa.eu/sites/default/files/img/media/13.spending6-02.png]
 

FAMILY SPENDING DATASETS ON DATA.EUROPA.EU

Apart from the abovementioned HBS data, other datasets published on
data.europa.eu offer valuable resources for analysing household
expenses, spanning from regional to local information. 

At the national level, one of the most interesting datasets shows what
Dutch households spend their money on, breaking it down by the average
for all families, the poorest 10 % of families and the richest
10 % of families. With information available up to 2020, it
highlights what families with different levels of income spend their
money on. 

The expenditure data for Dutch families shows clear differences in how
the poorest and richest 10 % of families use their budget.
Lower-income families spend a larger portion of their money on
essentials like housing, water and energy. They also spend a higher
percentage of their income on things like alcoholic beverages and
tobacco than wealthier families, although the actual money spent on
these items is roughly the same for both groups. In contrast,
wealthier families tend to spend more on transport, home appliances,
maintenance and dining out. Also, the poorest families dedicate a
greater part of their spending to education compared with the richest
families. 

These spending patterns from 2020 also reflect the effects of the
pandemic, suggesting that there might have been an increase in
spending on home-related needs and a decrease in expenses such as
travel and eating out, along with a general trend to tighten overall
spending due to economic strain. 

The following visualisation details this information, highlighting how
spending changes between rich and poor families and the effects of the
COVID-19 pandemic in 2020.
[https://data.europa.eu/sites/default/files/img/media/13.spending6-03.png]
The data.europa.eu portal also offers data at the regional level.
Examples include datasets like family budgets in the Asturias region
of Spain
[https://data.europa.eu/data/datasets/https-datos-gob-es-catalogo-a03002951-presupuestos-familias-ine-asturias-v1-historico?locale=en%22%20\h%20HYPERLINK%20%22http://data.europa.eu/88u/dataset/https-datos-gob-es-catalogo-a03002951-presupuestos-familias-ine-asturias-v1-historico?locale=it],
which provides a focused classification of household expenditure by
spending groups in a specific region.

This level of detail allows for in-depth analysis of consumer
behaviour and spending patterns within narrower geographic confines,
offering valuable insights into regional economic conditions and the
unique financial behaviours of households in specific areas of the EU.

The Asturias data shows that food and non-alcoholic beverages are
important, making up a large part of total expenses. Transportation
also takes a significant share, followed closely by housing, water and
energy costs. Other notable categories include spending on restaurants
and hotels, while leisure and culture, clothing and footwear, health,
furniture and household items and communications account for smaller
portions of the budget.
[https://data.europa.eu/sites/default/files/img/media/13.spending6-04.png]
Over time, there has been a clear shift in the monthly spending habits
of families between 2016 and 2022. Monthly spending remained stable in
2016 and 2017, followed by a gradual increase into 2019. In 2020,
there was a sharp decline, reflecting the impact of the pandemic on
consumption patterns. However, the subsequent years show a recovery,
with spending picking up again in 2021 and rising significantly in
2022. The timeline above highlights the economic fluctuations over
these years but does not adjust for inflation, which could affect the
interpretation of the actual spending power changes over time. 

In addition, the data visualised does not include imputed rent, an
estimate of the rental value of a homeowner’s property used to
measure the benefit of living in one’s own house.

 

EXPLORING ADDITIONAL DATA SOURCES ON FAMILY SPENDING

There are several keywords that can be used to look for family
spending data on the data.europa.eu portal. Examples include
‘household expenditure
[https://data.europa.eu/data/datasets?query=%22household%20expenditure%22&locale=en]’,
‘family spending
[https://data.europa.eu/data/datasets?query=%22family%20spending%22&locale=en&page=1]’
and similar terms.

 

METHODOLOGICAL NOTES 

Despite ongoing efforts to standardise data collection, there are
still limitations in comparing data from the HBS across different
Member
[https://ec.europa.eu/eurostat/web/household-budget-surveys/information-data]
States. These challenges stem from variations in the survey
methodologies each EU Member State employs, affecting the uniformity
of the data. The inclusion or exclusion of imputed rent is the most
important methodological difference. To mitigate these differences,
Eurostat regularly recommends harmonisation measures and publishes
detailed transmission documents to address these disparities
[https://ec.europa.eu/eurostat/web/household-budget-surveys/publications%22%20/l%20%22methpub]. 

Spending categories are defined as follows. 

 	*
FOOD AND NON-ALCOHOLIC BEVERAGES: includes all food items and
non-alcoholic drinks for household consumption, such as bread, milk
and fruit juices. 

 	*
ALCOHOLIC BEVERAGES, TOBACCO AND NARCOTICS: covers items such as beer
and cigarettes. 

 	*
CLOTHING AND FOOTWEAR: encompasses all clothing items and shoes, for
example, dresses and sneakers. 

 	*
HOUSING, WATER, ELECTRICITY, GAS AND OTHER FUELS: includes expenses
related to housing, rent, water and electricity. 

 	*
FURNISHINGS, HOUSEHOLD EQUIPMENT AND ROUTINE HOUSEHOLD MAINTENANCE:
contains items such as furniture, kitchen appliances and cleaning
products. 

 	*
HEALTH: covers health-related products and services, including
prescription medicines and medical consultations. 

 	*
TRANSPORT: includes costs related to personal vehicles, public
transportation and freight services. 

 	*
INFORMATION AND COMMUNICATION: involves electronic devices and
communication services such as internet and phone bills. 

 	*
RECREATION, SPORT AND CULTURE: includes leisure activities and items,
such as sports equipment, concert tickets and books. 

 	*
EDUCATION SERVICES: covers education-related expenses at various
levels, from preschool to higher education. 

 	*
RESTAURANTS AND ACCOMMODATION SERVICES: involves dining out and
lodging services like hotels. 

 	*
INSURANCE AND FINANCIAL SERVICES: includes insurance premiums and fees
for financial services. 

 	*
PERSONAL CARE, SOCIAL PROTECTION AND MISCELLANEOUS GOODS AND SERVICES:
contains personal care products, social protection services and other
miscellaneous expenses.

 

_Article by Davide Mancino _

_Data visualisations by Federica Fragapane _
