Average household income up across all income groups in 2008

By Julia Ng, Channel NewsAsia
20 January 2009 1700 hrs

SINGAPORE: Singaporeans of all income groups saw a real growth of 6 per cent in their family income last year.

The Department of Statistics attributed this to strong labour market conditions for the most part of 2008, leading to an increase in the number of working persons in a household.

The median monthly household income among all resident households grew 13 per cent from S$4,380 in 2007 to S$4,950 in 2008.

After adjusting for higher consumer price inflation, households enjoyed real growth of 6.2 per cent last year, compared to 7.2 per cent in 2007.

Families in smaller housing types enjoyed stronger income growth than those in bigger housing types.

Those in 3-room or smaller flats saw a 13 to 15 per cent jump in median household income, or 6 to 9 per cent in real terms, while income for those in bigger housing types grew by 9 to 12 per cent, or 2 to 6 per cent in real terms.

The average household income per household member also increased in real terms across all income groups. The increase was highest between the 21st and 90th percentile employed households, which saw a 5 to 5.4 per cent increase in 2008 in real terms.

The bottom 20 per cent employed households had an increase in real income per household member of 2 to 3 per cent, while the top 10 per cent employed household had growth of 0.9 per cent.

With faster income growth among the 21st to 90th percentile of employed households, income inequality narrowed – the Gini coefficient, which measures income inequality, shrank from 0.489 in 2007 to 0.481 in 2008 for the first time in a decade.

The government's Surplus Sharing Package also helped to reduce the income disparity further in 2008. After adjusting for government benefits and taxes, the Gini coefficient among employed households was reduced to 0.462 in 2008, compared to 0.479 in 2007.

The Department of Statistics noted that the package gave a larger boost to the lower income groups. On average, it added S$1,670 per household member to Singaporean families in HDB 1- and 2-room flats, and S$1,320 each to those in 3-room flats.

This is more than the S$720 per household member for families in private flats and landed properties.

The statistics department's paper is available online at www.singstat.gov.sg.