Swedbank’s Institute for Private Finances estimates Estonian people lose more of their income in case of a short-term illness, or nearly 18% while in Lithuania and Latvia, the decline in the income is 10%, Äripäev.ee/LETA reports.
According to the Institute, the income of an Estonian resident with gross monthly salary of 800 euros falls in the event of two-week sickness for about one-fifth or 115 euros, while in Lithuania and Latvia, incomes drop by 11% and 10%, or about 68 to 54 euros per month respectively.
“It is necessary to take into account the fact that Health Insurance Foundation pays a compensation on the basis of the preceding year’s income taxed with social tax, which is why people who have just started working and people who for example return to work from parental leave, are in a more unfavorable situation, as in the year prior to falling ill they did not work,” said the Institute’s Manager Lee Maripuu.
When staying home to care for a sick child, the state’s support reaches 80% of a person’s income. Staying at home with a sick child for five working days, the parent’s income falls 8.7% in Estonia and Latvia and just 1.5% in Lithuania. “Estonia and Latvia allocate sick day compensations for the weekend days too, so that in these countries, the fall of income can be smaller if a parent stays home with the child for a longer period of time,” said Maripuu.
The analysis showed that while with seasonal illness, the income of employees is largely guaranteed via social insurance, when a person loses the job, the family budget becomes considerably more strained, a decrease of 30-40% in the first months of job loss, and later even more. If the employment relationship is terminated by some other reason than redundancy, a person must register as unemployed and has to cope with EUR 112 a month of jobless benefit and savings.
The study, conducted in April, indicated that in the past four years, the percentage of families who are able to save on their monthly income has increased considerably. While in 2010, 44% of the Estonian population could save some money, this year’s study shows that the share was 51% of households and on average 14% of monthly income could be saved.
Source: The Baltic Course
http://www.baltic-course.com/eng/analytics/?doc=92920