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Eurostat: Romania, the highest disparities between regions
In 2018, regional GDP per capita, expressed in terms of purchasing power standards (PPS), ranged from 30% of the European Union (EU) average in Mayotte, an overseas region of France, to 263% in Luxembourg. As the map below shows, there is a considerable variation both between and within the EU Member States. This information is taken from data released by Eurostat, the statistical office of the European Union.
The leading regions in the ranking of regional GDP per capita in 2018, after Luxembourg (263% of the EU average), were Southern (225%) and Eastern & Midland (210%) in Ireland, Brussels Region (203%) in Belgium, Hamburg in Germany (197%) and Prague in Czechia (192%). The 39 EU regions with GDP per capita equal to or above 128% of the EU average account for 20% of the EU’s population and 32% of the EU’s GDP in PPS.
In contrast, after the overseas region of France Mayotte (30% of the EU average), the lowest regions in the ranking were three Bulgarian regions: North-West (34%), North-Central (35%) and South-Central (36%). In the case of Mayotte the low GDP per capita is mainly explained by demographic factors, since 42% of the population is less than 15 years old.
The 57 EU regions with GDP per capita equal to or below 67% of the EU average account for 21% of the EU’s population and 12% of the EU’s GDP in PPS. The other three groups of regions depicted in the map, with GDP per capita from 105 to 127, 84 to 104 and 68 to 83 of the EU average represent 25%, 18% and 14% respectively of EU GDP in PPS.
Regional GDP differences from 35% to 235% for labour productivity
In 2018, regional GDP per person employed, expressed in terms of purchasing power standards, ranged from 35% of the European Union (EU) average in South-Central in Bulgaria, to 235% of the average in Southern in Ireland. After Southern (235% of the average) and Eastern & Midland (205%) in Ireland, the leading regions in the ranking of regional GDP per person employed in 2018, were Luxembourg (165%), Brussels Region (161%) in Belgium, Île de France in France (158%) and three regions in Belgium: Walloon Brabant (157%), Flemish Brabant (144%) and Antwerp (143%). For many of these regions, GDP per capita is higher than GDP per person employed.
This can be a result of multiple factors. A common factor in EU regions with the highest GDP per capita is a net commuter inflow that tends to increase GDP per capita in regions where these commuters are employed and decrease it in regions of their residence. Other factors include higher labour market participation rates, lower unemployment rates and a higher proportion of the working-age population.
The impact of these factors can be analysed by comparison of GDP per capita and GDP per person employed. In 2018, among regions where GDP per capita was higher than GDP per person employed, the largest differences were observed in Luxembourg (263% of the EU average compared to 165%), ahead of Prague (192% compared to 121%) in Czechia and Budapest (145% compared to 75%) in Hungary.
In contrast, among regions where GDP per person employed was higher than GDP per capita, the largest differences were observed in French Guiana, an overseas region of France (105% of the EU average compared to 48%), ahead of two other overseas region of France: Mayotte (79% compared to 30%) and Guadeloupe (107% compared to 73%), followed by Sicily (90% compared to 59%) in Italy and Hainaut (105% compared to 75%) in Belgium.
Lower GDP per capita compared to labour productivity as percentage of the EU average is the result of a lower share of employed persons compared to total population, which is explained by lower labour market participation rates, higher unemployment rates, a higher proportion of population of non working-age and/or net commuter outflow.
Regional differences in labour productivity are considerably smaller than in GDP per capita
Among the EU Member States with more than 2 NUTS2 regions, the highest regional disparities between the regions with the highest and the lowest GDP per capita are observed in Romania (ratio of 3.6), Poland and Slovakia (both 3.3), Hungary (3.2), Ireland (3.1) and Czechia (3.0), while the lowest ratios are recorded in Finland and Portugal (both 1.5), Sweden and Austria (both 1.7) as well as Denmark, Spain and the Netherlands (all 1.9).
These notable regional disparities in GDP per capita within EU Member States are substantially narrower when expressed per person employed (labour productivity), with the largest decreases observed in Hungary (from 3.2 for GDP per capita to 1.1 for GDP per person employed), Slovakia (from 3.3 to 1.8), Italy (from 2.8 to 1.6), Belgium (from 2.8 to 1.7), and as well as Czechia (from 3.0 to 1.9).
Among EU Member States with the highest regional disparities, the ratio for GDP expressed per capita remains at a similar level when expressed per person employed only in Romania (3.5) and Ireland (3.0).