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 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 Global Data, 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.
The UK Median Household Income Highlights in 2021
The UK median household income (PPP) hit $46,691 in 2021, an increase of 1.6% over the previous year. Between 2010 to 2021, the UK median household income increased by 36.6%.
According to Global Data, the economic growth stood at 7.5%, and real household consumption expenditure growth at 7.4% in 2021. With the easing of restrictions and pick up in external demand, both GDP and household consumption expenditure recovered.
Due to the outbreak of the COVID-19 pandemic in 2020, many households have faced the consequences of reduced income. However, the government is taking steps to help vulnerable households and businesses that have suffered the impact of the pandemic.
Recent trends influencing Global Economic Growth
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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