Real Household Income Shifts to Growth

  • By Hwang Ji-yoon

    November 24, 2023 10:40

    Real household income rebounded in the third quarter for the first time in a year and three months. Hiring kept rising despite increasing inflation, resulting in overall income growth.
    According to Statistics Korea on Thursday, the average household income from July to September was W5.03 million a month, up 3.4 percent on-year, and even factoring in inflation, real income edged up 0.2 percent (US$1=W1,298).
    Real income had declined at a slower pace or remained steady since the third quarter last year, but in the second quarter this year it plummeted 3.9 percent on-year, the biggest drop on record. But now the situation has improved. Lee Jin-seok at Statistics Korea said, "Average salaries rose due to an increase in employment at better wages." 
    The average disposable income, which subtracts taxes, interest payments and other non-consumption expenditures from salaries, stood at W3.97 million a month in the third quarter, up 3.1 percent. The proportion of households whose expenditures surpassed their disposable income edged down 0.7 percentage points to 24.6 percent.
    But household expenditures increased four percent to W3.87 million. Service spending rose 3.9 percent to W2.81 million, though actual spending edged up only 0.8 percent due to inflation. Higher interest rates pushed up interest payments by a whopping 24.2 percent. 
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