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.

Gallup gross median household income

In 2013, Gallup published a list of countries with median household income, based on a self-reported survey of approximately 1000 adults from each country.^[1] Using median, rather than mean income, results in a much more accurate picture of the average income of the middle class since the data will not be skewed by gains and abnormalities in the extreme ends. The figures are in international dollars using purchasing power parity and are based on responses from at least 2,000 adults in each country, with the data aggregated from 2006 to 2012. Below is a list of the top 30 countries. The figures are before deduction of taxes and social contributions.^[1]

Rank Country/Territory Gross household income in USD PPP[1] Gross per-capita income in USD PPP[1] 1  Luxembourg 52,493 18,418 2  Norway 51,489 19,308 3  Sweden 50,514 18,632 4  Australia 46,555 15,026 5  Denmark 44,360 18,262 6  United States 43,585* 15,480 7  Canada 41,280 15,181 8  South Korea 40,861 11,350 9  Kuwait 40,854 7,487 10  Netherlands 38,584 14,450 11  New Zealand 35,562 12,147 12  Hong Kong 35,443 9,705 13  Austria 34,911 12,284 14  Finland 34,615 15,725 15  Japan 34,822 10,840 16  Germany 33,333 14,098 17  Taiwan 32,762 6,882 18  Singapore 32,360 7,345 19  United Kingdom 31,617 12,399 20  France 31,112 12,445 21  Israel 30,364 7,847 22  Belgium 26,703 10,189 23  Qatar 26,555 5,117 24  Slovenia 25,969 8,656 25  Ireland 25,085 8,048 26  Saudi Arabia 24,980 4,762 27  Bahrain 24,633 4,778 28  Czech Republic 22,913 7,821 29  Spain 21,959 7,284 30  Italy 20,085 6,874

• Based on analysis on US median household income, median household money income during the 2006-2012 period averaged $53,836, therefore by comparison the Gallup result is underreported and is even below the Census' own figures. ^[2]A study on the Census income data showed that when correcting for underreporting, US gross median household income was $58,997 between 2006 and 2010 (table 3). ^[3]

OECD Statistics

The annual median equivalence 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)[4]	Year
1	Luxembourg	38,502	2012
2	Norway	35,528	2012
3	Switzerland	35,083	2012
4	United States*	30,616	2013
5	Australia	29,875	2012
6	Austria	28,736	2012
7	Canada	28,288	2011
8	Denmark	27,304	2012
9	Belgium	27,195	2012
10	Sweden	27,167	2012
11	Iceland	27,029	2012
12	Netherlands	26,440	2013
13	Finland	25,730	2013
14	Germany	25,528	2012
15	France	24,233	2012
16	New Zealand	23,422	2012
17	Ireland	22,018	2012
18	South Korea	21,916	2011
19	United Kingdom	21,033	2012
20	Italy	20,874	2012
21	Slovenia	19,981	2012
22	Japan	19,967	2009
23	Spain	19,684	2012
24	Israel	18,032	2013
25	Czech Republic	15,055	2012
26	Portugal	14,101	2012
27	Slovakia	13,920	2012
28	Poland	13,248	2012
29	Greece	12,217	2012
30	Estonia	11,947	2012
31	Hungary	11,927	2014
32	Russia	10,746	2010
33	Turkey	8,575	2012
34	Chile	8,540	2011
35	Mexico	4,910	2012

• 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%). 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).^[5]

Median household income and the US economy

This graph shows the income of the given racial and ethnic groups, in 2014 dollars.^[6]

Since 1980, U.S. gross domestic product (GDP) per capita has increased 67%,^[7] 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.^[8] In the mean time, GDP per capita has increased by 33.8% or 1.33% annually.^[9]

A comparison between Median Equivalised Household Income and GDP per Capita in USD for select developed countries is shown in the chart below.^[10][11]

See also

• 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
• 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

References