Median household income
Median income is the amount that divides the income distribution into two equal groups, half having income above that amount, and half having income below that amount. Mean income (average) is the amount obtained by dividing the total aggregate income of a group by the number of units in that group.
Household income is not to be confused with family or personal income. Household income is often the combination of two income earners pooling their resources and should therefore not be confused with an individual's earnings.
Good example of typical wrong use may be comparing OECD(see below) 2012 for Poland. While it says 2011 is 12,615(or $1051.25 per month) the minimal wage per month(after taxes and non-volunteer like medical insurance etc.) is 1237 PLN(2014)-~$371.85. Compared to more showing "dominant wage"(which may show what most people get, of course depending on the source) 1599 PLN(2014)-~$480.68. Even if this sum would be multiplied by two person - $961.35 it can show differences(even greater than 10%) between sources and method of counting.
- OECD Statistics 1
- Median household income and the US economy 2
- See also 3
- References 4
The annual median equivalised disposable household income for selected countries is shown in the table below. This is the disposable income of an equivalent adult in a household in the middle of the income distribution in a year.
Data are in United States dollars at current prices and current purchasing power parity for private consumption for the reference year.
|Rank||Country||Median income (US$, PPP)||Median income (US$, nominal)||Year|
- Based on analysis of the CPS data, US median household income has been consistently under-counted by a ratio of 83-85% (mean undercounted by 75%), thus making median income $37,228 but for the undercounting. Other analysis has shown varying rates of quality among countries; For example, Norway, Sweden, Denmark, Netherlands, Germany, Austria, and UK all captured 85% or more income as compared to the national accounts (details in link—Appendix 4).
Median household income and the US economy
Since 1980, U.S. gross domestic product (GDP) per capita has increased 67%, while median household income has only increased by 15%. An economic recession will normally cause household incomes to decrease, often by as much as 10% (Figure 1).
Median household income is a politically sensitive indicator. Voters can be critical of their government if they perceive that their cost of living is rising faster than their income. Figure 1 shows how American incomes have changed since 1970. The last recession was the early 2000s recession and was started with the bursting of the dot-com bubble. It affected most advanced economies including the European Union, Japan and the United States.
The current crisis began with the bursting of the U.S. housing bubble, which caused a problem in the dangerously exposed sub prime-mortgage market. This in turn has triggered a global financial crisis. In constant price, 2011 American median household income is 1.13% lower than what it was in 1989. This corresponds to a 0.05% annual decrease over a 22-year period. In the mean time, GDP per capita has increased by 33.8% or 1.33% annually.
A comparison between Median Equivalised Household Income and GDP per Capita in USD for select developed countries is shown in the chart below.
- List of countries by average wage
- List of U.S. states by income
- Mean household income
- Income distribution
- Income quintiles
- Household income in the United States
- International Ranking of Household Income
- Median household income in Australia and New Zealand
- Median income per household member
- Places in the United States with notable demographic characteristics
- Poverty in the United States
- "OECD Statistics".
- DeNavas-Walt, Carmen; Proctor, Bernadette D.; Smith, Jessica C. (September 2012). "Real Median Household Income by Race and Hispanic Origin: 1967 to 2010". Income, Poverty, and Health Insurance Coverage in the United States: 2011. U.S. Census Bureau. p. 8.
- "OECD(2011), Society at a Glance 2011 - OECD Social Indicators". OECD. Retrieved 12 March 2012.
- "World Economic Outlook database October 2007". International Monetary Fund. Retrieved 12 March 2012.