Report reveals huge inequality in families' disposable income
ALMOST two-thirds of households have an income below the national average, according to new research from the Nevin Economic Research Institute due to be published today.
While 62pc earn less than the national average, the top 30pc of households earn more than €70,000 when salaries and welfare payments such as child benefit are included, according to the trade union-funded think tank. Only 2pc of households earns more than €200,000 a year while 14pc earn more than €100,000. The mean household income is €56,522.
"The income distribution is highly skewed, with more than 60pc of households having an income below the (mean) average," the report says, following analysis of information collected by the Central Statistics Office in 2009.
NERI economist Micheal Collins said policymakers often underestimated how many households earned less than €50,000.
The report also finds that just under a third of households have a disposable income of less than €500 a month. Half of households have a disposable income of less than €38,255 a year while the top fifth of households have an annual disposable income of more than €67,000.
The think tank's latest report contains gloomy forecasts for economic growth over the next few years. It predicts that the economy will expand less than 1pc this year and again next year as the domestic economy contracts thanks to last month's Budget. Unemployment is seen as rising to more than 15pc.
"Our projections are pessimistic, highlighting an ongoing economic stagnation as a result of continued contractions to domestic demand, sustained uncertainty at a European level and a related slow recovery of the international economy," the report says.
It also questions the Government's capacity to reach its fiscal targets in 2015 and to limit the increase in the national debt without significant changes in policy and improvement in international conditions.
While agreeing that the economy had seen "a number of positive economic developments", the NERI warned that there were problems. It highlights the recent collapse in industrial production, the high levels of youth unemployment and long-term unemployment and what it sees as "continuing stagnation" in domestic demand.