The evolution of social vulnerability in Greece during the economic crisis (2008-2017)

By Michail Melidis & Stylianos I. Tzagkarakis
13 Dec 2021

After a long period in the doldrums with austerity measures and consecutive bailouts, Greece still bears the scars of the recent financial adventure while strives to recover in a new economic environment. As one of the hardest-hit by the economic crisis Member states, Greece has seen its economic capacity reduced, the unemployment and poverty levels rising, and the living conditions for a significant part of the population and social groups deteriorating. Despite the plethora of analyses on the political and socio-economic perspectives, the evolution of social vulnerability remains a largely unexplored area that merits further investigation and analysis in a crisis-ridden country of the European South. The paper aims to study how social vulnerability has evolved in Greece from 2008 to 2017 using secondary data and descriptive statistics that focus on five key variables (disposable income, education, employment, gender, urban/rural environment) for a better understanding of the domestic social vulnerability dynamics in a period of stark contrasts. Overall, our findings demonstrate an increased risk of social exclusion and a widening of inequality and poverty rates during the stated period.

1. Introduction

While the cycle of consecutive crises (i.e. the financial crisis in 2008, the sovereign debt crisis in 2009-2010, and the Great Recession from 2008 to 2012) that staggered the global and European economy the last decade is seemingly closed, their strong legacy lends useful lessons for the fragility and volatility of national economies in light of persistent socio-economic challenges. As Verney (2009:1) rightly put it, ‘as the financial storm clouds began to gather, the potential weakness of Europe’s south rapidly emerged as a focus of concern’. Not far from this view, Manasse and Katsikas (2017) claimed that the euro area debt crisis has largely been a crisis of the European South. Issues of competitiveness, power imbalances among and within the Eurozone and EU Member states, the ‘core-periphery’ divide, and the different policy prescriptions in response to the economic crisis raised many questions about the future of the EU and the sustainability of the European growth engine (Celi et al. 2017; Parker and Tsarouhas 2018).

With the term of the economic crisis in this study, we refer to the protracted period of economic hardship that afflicted many Member states following the sovereign debt and Eurozone crisis. Indicatively, Cyprus, Greece, and Portugal facing sovereign default, struck bailout agreements that involved the application of inclusive financial adjustment programs. Subsequently, Spain’s ailing financial sector received a more limited financial package and countries such as Italy which were not in need of an immediate financing agreement, felt the pressure to adjust their economies. In exchange for bailout funds, Badwin and Giavvazzi (2015) underscored the importance of structural reforms and fiscal consolidation as the main pillars of the euro area’s strategy to tackle the crisis.

According to Parker and Tsarouhas (2018:2), ‘the crisis has cast the relationship between the two categories of state in a new light that renders the ‘core–periphery’ concept increasingly pertinent.’ Apart from the exposure of shared vulnerabilities (e.g. structural, institutional, and administrative inefficiencies) of ‘peripheral’ states (i.e. Greece, Portugal, Italy, and Spain) in relation to ‘core’ states (i.e. Austria, Belgium, France, Germany, and The Netherlands), other differences between the two groups were identified in the use of different economic models, prescriptions and growth strategies to surpass the crisis (Bartlett and Prica 2016). Additionally, economic asymmetries – that predated the economic crisis – contributed to a considerable GDP contraction and running government budget deficits for the former and lesser effects for the latter as their economies proved more resilient and robust (Serapioni and Hespanha 2019). In light of different domestic structures and economic dynamics in EU Member states, the impact of the economic crisis and austerity measures varied significantly with Southern Europe and particularly Greece suffering the most (Featherstone 2011).

Amid economic uncertainty, the emergence of social pressing issues in Southern Europe such as poverty, material deprivation, unemployment, and job insecurity were no surprise (Buendia 2018; Dooley 2018). In our research, Greece is a particularly significant case to study as its pro-crisis high growth rates and thereafter the excessive government borrowing and skyrocketing government bond yields left it exposed to an unparalleled financial storm (Morlino and Sottilotta 2019). Such a condition rendered Greece one of the hardest-hit Member states and biggest recipients of international financial aid from the EU and IMF through three economic adjustment programs in 2010, 2012, and 2015 (Verney 2009). Arguably, the country’s long austerity and economic recession brought about an unprecedented cut in government spending and a significant GDP contraction by 25% (from 2009 to 2016 before it started rising again in 2017) (Matsaganis 2011; Petmezidou and Guillén 2014; Eurostat 2020a; 2021a). Evidence demonstrates that a significant part of the Greek population was at risk of poverty, social exclusion, and material deprivation caused, inter alia, by precarious forms of work and unemployment (Papadopoulou et al. 2014; Gkasis 2018; Eurostat 2020b; Eurostat 2021b).

Turning now to the issue of identifying the dynamics of social vulnerability, many scholars have adopted various approaches, methodologies and analyses (Lindsay et al. 2015; Morrone et al. 2011). Social vulnerability is defined here as the reduced capacity of an individual or community to foresee, manage, withstand and recover from the adverse effects of natural or human-made events. To gain insight into what drives social vulnerability, we selected five different variables (disposable income, education, employment, gender, urban/rural environment). Especially, disposable income indicates the relation of purchasing power and household expenditure with income inequalities; education points how unequal access can affect child poverty, social exclusion, and social mobility; employment presents how precarious forms of work and economic instability may increase poverty; gender shows how males and females are impacted by unemployment and income inequality; and lastly, urban/rural environment depicts the context within which inequalities and phenomena of social exclusion can take place.

Against this backdrop, social vulnerability in Greece constitutes a largely under-researched area whose investigation can provide a deeper understanding of the domestic dynamics in light of the economic crisis. Hence, the aim of our study is to build upon the existing literature, conduct a rigorous and contemporary analysis, and provide a clear picture of how has social vulnerability in Greece evolved from 2008 to 2017, a period fraught with stark controversies and complexities. Methodologically, our research employs secondary data from the Eurostat, ELSTAT, ILO, Bertelsmann Stiftung, and OECD datasets, and descriptive statistics (correlation analysis) complemented by various reports to show the link between the five different variables and social vulnerability. In the article that follows, the first section of our analysis outlines the conceptual framework and the basic theoretical considerations of social vulnerability. Then, the second part gives an overview of the methodological steps and the third exhibits the empirical analysis underpinned by descriptive statistics (correlation analysis). Lastly, the fourth section discusses the key findings such as the emergence of patterns of social exclusion, and the widening of inequality and poverty and draws some broader conclusions.

1.1. Defining social vulnerability

Social vulnerability has been a relatively new concept that has triggered long debates amongst academics since the 1990s but its widespread use is traced back to the early 2000s across different disciplines (Spini et al. 2013; Oris et al. 2016). Interestingly, it has been a subject of wide-ranging research in the existing literature assisted by an abundance of definitions, methodologies, and analyses (Vasta 2004; Ranci 2010; Morrone et al. 2011). The diversity of scholarly views and the lack of a commonly accepted definition has inevitably caused conceptual confusion while interdisciplinarity added more versatility to a purported narrow term. In this respect, vulnerability is described as a state of openness and powerlessness but has also been featured as passiveness, exposure, liability, and susceptibility. For the purposes of this research, we will rely on the definition of Chambers (2006:33) who points out that ‘vulnerability […] refers to exposure to contingencies and stress, and difficulty in coping with them. Vulnerability has thus two sides: An external side of risks, shocks, and stress to which an individual or household is subject; and an internal side which is defenselessness, meaning a lack of means to cope without damaging loss. Loss can take many forms – becoming or being physically weaker, economically impoverished, socially dependent, humiliated or psychologically harmed’.

In a narrow context, social vulnerability is an aspect of vulnerability (i.e. the other three dimensions are physical, functioning, and economic vulnerability) which encompasses several pressing factors or stressors that determine the extent to which someone’s livelihood and life can be put in danger by distinct and recognizable occurrences in society or nature (Ranci 2010). Notably, social vulnerability is employed to explain specific risks in each discipline (i.e. environmental, economics, societal, etc.). These may include potential harm and losses to people, abuse, exclusion, marginalization, shocks, and natural hazards (Lindsay et al. 2015). In essence, the term of social vulnerability refers to the features of a person or a group of people, societies, and organizations with regards to their (in)ability to anticipate, encounter, withstand and recover from adverse impacts derived from pressing factors or stressors to which are exposed (Spini et al. 2013). This (in)ability is attributed to elements found in social interactions, culture, and institutions. With regard to the main characteristics, particular emphasis is placed on family structures, community organizations, civic participation (i.e. unequal participation in decision making, political accountability, lack of leadership and conflict resolution), discrimination (i.e. racial, ethnic, linguistic, and religious), culture (i.e. tradition, values, local norms), and economic condition (Zimmermann 2017).

Drawing on the existing literature, the populations that seem particularly vulnerable and prone to old and new social risksi are children, young people, working women, migrants-refugees, families with young children, and low-skilled individuals (Kiss 2016). To this end, Bonoli (2005: 435) argued that ‘while it is difficult to set clear borders around the section of the population that bears most NSRs [new social risks], it is clear that the categories […] are largely overlapping, and that it is possible to identify in every post-industrial society a fairly large minority of the population that struggles daily against the consequences of NSRs’. Ervasti et al. (2012:26) put forward the relationship of new social risks with the (un)successful entry into the labor market by stating that new risks might become more acute for ethnic and social minorities than the population majority.ii Other significant contributors are the reduced capacity of the state and family to provide support for the children and elderly as well as the lack of adequate training and education.

Interestingly, Leoni’s description (2016:835) has offered more details about the key characteristics of the ‘socially vulnerable groups’ by underscoring the significance of the socio-economic background, gender, ethnicity, social class, poverty, unemployment, and health needs. Finally, the definition of the European Foundation for the Improvement of Living and Working Conditions (2002) linked socially vulnerable groups to (un)employment and the risk of exclusion from the labor market. Correspondingly, Greek law 4375/2016 makes a reference to the crisis-stricken socially vulnerable groups. In this category are included the unemployed, poor, elderly, children, single parents, victims of violence and human trafficking, disabled, and ill. In addition, the uninsured, those suffering from chronic diseases and mental disorders, and the generalized vulnerability of the workforce caused by informal, precarious, and casual employment could also be listed (Economou et al. 2014; Papadopoulou et al. 2014; Zafiropoulou 2014). For example, the exclusion of young people from education and vocational training may make their access to labor market more difficult. Additionally, the lack of social relations and civic participation may increase anxiety. In this setting, social vulnerability can have a link with characteristics such as anxiety, depression, and mental problems with long-term implications (Zafiropoulou et al. 2018).

Continue reading at