S.Korea's household income rises in 2019 on welfare policy
Source: Xinhua | 2020-12-18
South Korea's household income rose last year on an expanded welfare policy, reducing income cap to the lowest level, official data showed Thursday.
Annual income of households averaged 59.24 million won (54,200 U.S. dollars) in 2019, up 1.7 percent from a year earlier, according to joint data from Statistics Korea, the Bank of Korea, and the Financial Supervisory Service.
Earned income added 0.3 percent to 37.91 million won (34,700 U.S. dollars), but business income shrank 2.2 percent to 11.51 million won (10,530 U.S. dollars).
Household income grew among all income groups owing to the government's expanded welfare policy, such as the increased basic pension and childcare benefit, which led to growth in public transfer income.
The public transfer income jumped 18.3 percent to 4.57 million won (4,200 U.S. dollars) last year.
The government grants moderated income disparity. Household income for the bottom 20-percent income bracket increased 4.6 percent, while earnings for the top 20-percent income group grew 1.1 percent.
The country's Gini coefficient, which gauges income inequality, stood at 0.339 in 2019, down 0.006 from the previous year. The reading zero indicates a complete equality, while 1 means a complete inequality.
It was the lowest figure since data began to be compiled in 2011. The coefficient continued to slide since the Moon Jae-in government was inaugurated in 2017.
Meanwhile, household debt advanced early this year amid an economic fallout from the COVID-19 outbreak.
Household debts averaged 82.56 million won (75,600 U.S. dollars) as of end-March, up 4.4 percent from a year ago. It was faster than a 3.2-percent increase tallied in the previous year.
Debt among households in the bottom 20-percent income bracket picked up 8.8 percent in the cited period, while the household debt in the top 20-percent income group grew 5.3 percent.
Out of the combined households, 57.7 percent borrowed money from financial institutions at the end of March.
Among the total households with financial debt, 67.6 percent said it was burdensome to repay principal and interest. It was up 1.1 percentage points from a year earlier.
The ratio of debt to asset among households stood at 18.5 percent as of end-March, up 0.2 percentage points from a year earlier.
Households' average asset expanded 3.1 percent from a year earlier to 445.43 million won (407,700 U.S. dollars) at the end of March due mainly to higher housing price.
Actual assets, such as land and real estate, accounted for 76.4 percent of the total household asset as of end-March, up 0.9 percentage points from a year ago.
Average asset in the top 20-percent income bracket was up 3.6 percent to 980.54 million won (897,500 U.S. dollars) in the cited period.
It was over seven times larger than 136.29 million won (124,700 U.S. dollars) of asset held by the bottom 20-percent income group.
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