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ROME (Reuters) - Poverty in Italy has reached its highest level in at least 16 years as the economic crisis has bitten, driving up unemployment and cutting wages, according to a report on social cohesion issued on Monday.
Relative poverty, defined as a family of two living on a monthly income of 991 euros (847.61 pounds) or less, affected 12.7 percent of families, the highest level recorded since the current series of data began in 1997, the report by statistics agency ISTAT said.
The report, a compendium of data on issues ranging from employment to demographics, said poverty had deepened in all areas of Italy between 2011 and 2012. Relative poverty rose from 4.9 percent to 6.2 percent in the richer north and from 23.3 percent to 26.2 percent in the poorer south.
The report painted a grim picture of the impact of the country's worst post-war recession, with joblessness at record levels, incomes squeezed and permanent, full-time employment declining.
"As one of the countries most affected by the crisis, Italy registered a progressive decline in the main macroeconomic and social indicators in 2012," Labour Minister and former ISTAT chief Enrico Giovannini said in the introduction to the report.
"Nonetheless social cohesion has held up, enabling the country to support sacrifices aimed at recovering financial stability and passing important reforms," he said.
The relatively optimistic tone contrasted sharply with recent comments from employers' federation Confindustria, which warned this month that the recession had inflicted damage on the Italian economy comparable to that left by a war.
The hardships caused by unemployment and measures taken to keep straining public finances under control have fed mounting discontent, typified by a long series of occasionally violent street protests earlier this month.
Unemployment in Italy is at its highest level since at least the late 1970s with the overall jobless rate at 12.5 percent and youth unemployment as high as 41.2 percent in October, according to the latest ISTAT figures.
The data showed the number of workers on permanent, full-time contracts declined to 10.3 million in 2013, down 1.3 percent from a year earlier, with the number of young people on full-time contracts declining 9.4 percent in the year.
The figures underlined the challenge to Prime Minister Enrico Letta's government which plans to overhaul labour market rules to ease the divide between permanent workers with a full range of benefits and privileges and a growing army of part-time and temporary workers with few job protections.
Reporting by James Mackenzie; Editing by Ruth Pitchford