My Drum post today, as long time readers of all good blogs would know, owes a bit of debt to Matt Cowgill’s post of a couple years back. In the time since, the ABS has brought out some new figures, so I thought it timely, in light of Joel Fitzgibbon’s remarks about people struggling on $250,000 to update the figures.
One of the things about “equivalised” household income is that you can get a picture of what the disposable income needs to be for every size of household to maintain the same standard of living.
So for example the median disposable income for a single person is $37,180 and for a family with 2 adults and 2 kids it is $78,078.
Here’s what the median income is for different sized households:
The data also lets us have a look at how the different percentiles have grown, going back to 1994. It might not shock you to discover that the 90th percentile has grown the most and the 10th percentile has grown the least (and remember the P90 is not the top 10%, but those in the top 20 to 10%):
Certainly this does suggest the bottom 10% are being left behind. A good way to look at it is compare the ratio of the 90th percentile to the median and the bottom 10:
A clear increase in the size of the income of the 90th percentile compared to the 10th.
The next graph highlights just how far behind the bottom 10 precent are being left:
The gap between the median household and the bottom 10th has widened compared with the gap between the 90th percentile and the median income (though there has been a sharp reduction in the gap since 2007-08, no doubt showing the impact of the GFC on median incomes.
Here’s what the equivalised bottom 10 per cent per household looks compared to the median and the top:
But yes, we should worry about a class warfare being raged against those earning $300,000 or more, and keep as silent as the grave about Tony Abbott’s policy to stop the super tax offset for those earning less than $36,000.
Martin Jones in the comments has drawn my attention to his most excellent post on the link between gross and equivalised income. He has a very spiffy calculator that lets you work out given your equivalised income.