Median Household Income Overview
The indicator refers to the median income of a household in a country. Median household income divides households into two equal segments, such that the first half earns less than the median income while the second half earns more. The median income is defined in PPP (Purchasing Power Parity, in Current International Dollars) terms so as to avoid exchange rate fluctuations due to inflationary tendencies across countries. The median income level is generally accepted as a better indication of well-being or actual income distribution as it is not skewed by disproportionate data.
According to GlobalData, the top ten countries with the highest median household income in the world are Singapore, Iceland, Norway, Sweden, Ireland, Luxembourg, Belgium, the United States, Cyprus, and Australia. The average median household income (PPP) was $40,094 in 2021.
Switzerland’s Median Household Income Highlights in 2021
Switzerland’s median household income (PPP) hit $48,041 in 2021, a decrease of 0.5% over the previous year. Between 2015 to 2021, Switzerland's median household income (PPP) decreased by 11.1%.
Income distribution, as measured by the Gini index, was 29.7 in 2018, according to GlobalData. The Gini coefficient ranges from zero (perfect equality) to 100 (perfect inequality). Despite high wage levels, there are a considerable number of working poor who fall below the poverty line. Furthermore, the gap between the richest and poorest 10% was also greater in Switzerland compared to its neighbors.
Key elements that are influencing the Global Economy
Increased COVID-19 impact:
As a result of Omicron, a new variant of COVID-19, more cases have been reported worldwide, resulting in the disruption of supply chain management. However, the global vaccination drive has reduced the fatality rate from the coronavirus.
Rising Inflation and Interest Rates:
As a result of rising inflation rates in both developing and advanced economies, central banks have been forced to tighten monetary policy and raise interest rates to keep prices from rising. However, a steady increase in interest rates could cause financial distress in some economies.
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