6. Economic Capacity to Meet Essential Needs

6. Economic Capacity to Meet Essential Needs (ECMEN)

VERSION

V5.0 - 2026.03 — Existing

INDICATOR CODE

6

TECHNICAL OWNER

Assessments and Targeting Unit (PRG-FA)

INDICATOR TYPE

Country Level Outcome Indicator

INDICATOR CLASSIFICATION

Complementary

INDICATOR SCOPE

Programme specific

APPLICABILITY

The selection of this indicator is recommended against the following sub-activities in CSPs logframes for interventions where multipurpose cash transfers are being implemented, and the value of assistance provided covers several essential needs that are broader than the food needs (modality of assistance is cash transfers). Selection of the below sub-activities will NOT trigger the mandatory selection of this indicator:

1. General Distribution (GD);

2. Food assistance for assets (FFA);

3. Food assistance for training (FFT)

4. Smallholder Agricultural Market Support (SMS)

5. Forecast-based anticipatory actions (FBA)

6. Macro-Insurance (MAI)

7. Micro/meso Insurance (MMI)

8. Other Climate Adaptation and Risk Management Activities (CAR)

9. Climate Adapted Assets and Agricultural Practices (CAP)

When a CO selects the Essential Needs Marker at the activity level, this indicator is automatically triggered. Selecting the Essential Needs Marker implies that ECMEN must be measured.

UNIT OF MEASUREMENT & ANALYSIS

Percentage of households with economic capacity above the minimum expenditure basket (MEB) threshold

DEFINITION

This indicator aims to measure households’ economic capacity to meet all their essential needs, including food and non-food needs;  Economic capacity is calculated by aggregating expenditures based on ECMEN methodology.

The Minimum Expenditure Basket (MEB) is defined as what households require to meet their essential needs, on a regular or seasonal basis, and its cost. The MEB covers those essential needs that households meet fully or partially through the market. It serves as a monetary threshold that can be used to assess if households have the economic capacity to meet their essential needs. A country could have more than one MEB.

ECMEN is the only expenditure monitoring indicator for WFP programmes.

RATIONALE

The ECMEN indicator contributes to the understanding of food security in a population since the ability to meet essential needs through the market encompasses and can be a significant factor in accessing food. Assessing the economic capacity of households receiving food assistance can be challenging when considering their expenditures on both food and non-food items. The ECMEN overcomes this challenge by examining the household capacity, either excluding or including assistance, with reference to a recognized threshold such as the Minimum Expenditure Basket (MEB).

The MEB serves as a benchmark against which we evaluate households’ economic capacity to meet essential needs through the ECMEN indicator. Households whose economic capacity does not reach the MEB threshold can be considered economically vulnerable.

A household’s ability to meet its food and nutrition needs also depends on its ability to meet other essential needs. When households have limited resources, they will constantly have to prioritize between often equally urgent needs. A comprehensive understanding of essential needs therefore helps in the design of effective food security responses.

DATA COLLECTION TOOL

The standard module can be accessed as XLS Form to be used with MoDA or ODK, or be created through the WFP Survey Designer by selecting the indicator Economic Capacity to Meet Essential Needs (ECMEN) in the indicator area Food Security and essential needs. Keeping standard variable names allows for an easy application of standard syntax to calculate the indicator. Additional information, including word versions of the module, can be found in the VAM resource center page.

The accuracy of the indicator is closely connected to the methodological rigor used to construct the MEB. For best practices on constructing MEBs, we recommend using WFP’s MEB guidance note.

It is the responsibility of the technical focal point to apply the joint Monitoring and VAM Data Quality Guidance principles when collecting this indicator. If in doubt, please contact PRG-FA at global.assessmentandtargeting@wfp.org.

SAMPLING REQUIREMENTS

Sample size: The recommended sample size is 270 per stratum per round of data collection, with consideration given to the parameters below:

• Population size (beneficiaries per stratum): at least 20,000¹

• Desired level of confidence: 90%

• Acceptable margin of error: 5%

• Response distribution: 50%

• Simple random sample (design effect): 1

If cluster sample is employed, sample size should increase by at least 50% (at least 405 households).

If the prevalence is lower or higher than 50%, or the beneficiaries per stratum less than 20,000 then sample size could be lower than 270, use the sample size tool for calculation.

Mandatory stratification:

• Programme activity

• Transfer modality

Optional stratification:

• Beneficiaries/non-beneficiaries (when relevant)

Guidance on sampling is available here.

Sample size tool: Raosoft sample size calculator

INDICATOR CALCULATION FOR REPORTING

To compute the ECMEN, household expenditures are used as a proxy for household economic capacity against the MEB and Survival Minimum Expenditure Basket (SMEB) of the same population group. Both economic capacity and MEB are usually calculated on a per capita basis.

This indicator is calculated by using the following steps:

1. Identify the relevant MEB

2. Aggregate consumption expenditures to establish household economic capacity

3. Compare the economic capacity of each household against the MEB to establish whether a household is above this threshold

4. Compute the ECMEN indicator by calculating the percentage of households whose economic capacity is equal or greater than the MEB threshold

Note: When used for monitoring purposes, economic capacity also includes the value of consumed in-kind assistance. If the objective of the analysis is to understand and estimate needs, ECMEN can be calculated excluding assistance, as is done in assessments. It should be clearly marked if assistance is included or excluded.

Standard scripts are available on GitHub.

DATA ENTRY AND DISAGGREGATION IN CORPORATE SYSTEMS

Values are recorded in the logframe. Each value has a reporting combination which is created based on:

• Sub-activity

• Location

• Beneficiary Group

Follow-up value is reported as one number overall representing a percentage.

Recommended disaggregation (when sample size allows and relevant MEB is available):

• Sex of household head

• Rural/urban

• Admin and livelihood zone

• Displacement status (MEB value for residents vs. IDPs/refugees may differ)

• Household size (if relevant for transfer value adjustments)

BASELINE

Baselines are set only once, at one of the following points:

1. At the beginning of the CSP, or

2. When the indicator is selected for reporting after the commencement of the CSP, or

3. When there is a change in target, location and/or modality that triggers a new reporting combination (target, location and modality) for an existing indicator.

Baseline values should be established within three months before and no later than three months from the start date of activity implementation. However, it is strongly recommended to collect baseline values within one month before the start of the activity implementation. The baseline could also be determined from a relevant WFP assessment conducted within the three months prior to the start of programme activity.

For the sake of comparability, baselines, follow-ups and end-line surveys must be conducted using the same sampling frames and disaggregation/stratification criteria.

Setting a solid baseline is a key factor in measuring the impact of the programme. Additionally, when designed accordingly, it can enable factor analysis which can be used to measure the impact of potential future funding cuts. Get more information about this here.

TARGET SETTING

Annual targets:

Annual targets (in terms of percentage increase in the share of households with economic capacity>MEB) should be context specific.

It is, however, recommended to set annual targets as improvements from previous years (i.e., a higher share of households with economic capacity above the MEB compared to the previous year).

End of CSP target:

Project targets (i.e. percentage increase in the share of population of interest with economic capacity above MEB) should be set individually for each assistance project, as the expected outcomes will largely depend on the transfer value provided to the beneficiaries as opposed to actual needs.

For example, it might be that the MEB agreed upon with all humanitarian stakeholders is set at 150 USD per month for a household of 6 persons and an unrestricted cash transfer value is set at 100 USD. Without another significant source of income, it may be difficult for the household to reach an economic capacity level above the MEB. The outcomes will thus always be dependent on these parameters and setting targets should be context specific.

FREQUENCY OF DATA COLLECTION

Minimum: twice/year

For years when a baseline is conducted, only one follow up is required.

INTERPRETATION

REPORTING EXAMPLE(S)

“Overall, 53 percent of the population has the economic capacity to meet its essential needs. The rest of the population appears economically vulnerable, including a consistent share of the population (11 percent) whose economic capacity is not even sufficient to meet their survival needs”.

INDICATORS COLLECTED & ANALYSED AT THE SAME TIME

The following indicators may be reported along with this indicator:

Household level indicators:

• 1. Food Consumption Score (FCS)

• 2. Food Consumption Score-Nutrition (FCS-N)

• 3. Reduced Coping Strategies Index (rCSI)

• 5. Livelihood Coping Strategies - Essential Needs (LCS-EN)

COMPLEMENTARY QUALITATIVE RESEARCH

As ECMEN indicator provides quantitative results on households that fall either above or below the MEB, qualitative information could complement the results to get further insights into the ability of households to meet essential needs and cope with financial challenges.

Here are some example questions for a focus group discussion or for a face-to-face interview with key informants:

• How would you describe the economic situation of households in your community?

• How do households in your community prioritize their expenses? What are the items that households in your community need but haven’t been able to access and why have they not been able to access?

• What are specific challenges or barriers that households face in meeting their essential needs (i.e., food, shelter, education, health, etc.)?

• What are seasonal variations in the economic capacity of households to meet their essential needs?

• How do households cope with unexpected expenses?

• Do households in your community prepare for future shocks? If yes, how? Can you tell me whether household in your community are able to access credit or loans? And if so then what are the reasons?

• Which institutions or entities are the primary sources of credit or loans in your community?

For further guidance, please refer to the Essential Needs Assessment Guidance Note, or the Qualitative Research Guidance for WFP Monitoring.

DECISIONS DATA CAN INFORM

The ECMEN indicator helps in assessing the effectiveness of WFP's interventions in improving access to essential needs for targeted or assisted households. By monitoring ECMEN over time, trends can evaluate whether their interventions are achieving the desired outcomes and positively impacting the well-being of households.

For example, if the ECMEN does not show significant improvement or if there is a persistent economic vulnerability despite assistance, it may indicate the need to reassess the modality of assistance or explore additional support mechanisms to address the underlying causes of vulnerability.

VISUALIZATION

Use colours as recommended in the Data Visualization Guidance.

LIMITATIONS

This indicator measures households’ capacity to meet essential needs as a whole rather than as a specific sectoral outcome. The interpretation of ECMEN should ideally be paired with sectoral outcomes (e.g., food consumption, access to clean water, school attendance, health treatment coverage). The indicator’s accuracy depends on the analytical rigor with which the MEB has been constructed and on data quality.

Expenditure data can contain outliers that must be cleaned. Training of enumerators, using standard modules, and data collection monitoring are essential to prevent poor data quality.

MEB and ECMEN only cover needs that can be met through the market. Other structural gaps in the service-delivery systems - linked to poor facilities, limited commodities and/or human resources - or chronic infrastructural gaps may hinder accessibility to commodities and services required to meet needs.

FURTHER INFORMATION

Refer to the VAM Resource Centre or contact PRG-FA at global.assessmentandtargeting@wfp.org.