Average weekly before-tax investment and other income

This graph shows the average weekly income received by the various income groups from investment and ‘other income’.

The majority of people live in households that receive little or no income from investments, while a few receive large amounts. The middle 20% had an average of $150 per week from investments and other private sources, while the highest 20% had almost five times as much ($705) and the highest 5% had almost eight times as much ($1,125).

As a result, despite being a small share of overall income, investment income contributes substantially to overall income inequality.


Average weekly gross household income from wages

This shows average weekly incomes from wages (before tax) in each of the income groups.

The highest 20% of households receives almost three times the average wages of the middle income group (averaging $4,363 per week before tax compared with $1,645), while the middle 20% receives six times as much as the lowest 20% ($1,645 compared with $256).

Differences in average earnings received by household income groups are the result of variations in the proportion of people employed in different household income groups and the number of hours they work (see this graph), and their hourly pay.


Average weekly before-tax income from income support payments

This shows the average income support payments received by people in the different income groups in 2015-16.

The average social security income is $418 per week for the lowest 20%, of which 52% is from pensions and 20% is from allowances. In contrast, just 25% of the social security income of the lowest 5% is pensions and 37% is allowances. This can be explained by the fact that allowances are paid at a much lower rate, so people who receive them are more likely to be found in the lowest 5%.

The second 20% receives slightly less from income support payments than the first ($358 on average) due in part to the income-tests applying to allowances and pensions, but receives similar ‘other’ payments ($118) which mostly comprise Family Tax Benefit Part B.

Households in the highest 20% income group receive only $69 per week on average in social security payments.

While overall income from social security is much lower than earnings, the social security makes a substantial contribution to reducing inequality because the vast majority of payments go the lower half of people ranked by household income.

 

 


Australia’s population by age

This shows how Australia’s population is divided up by age in 2015-16. Almost two-thirds (66%) of Australia’s population are of working age (15-64 years old), followed by children under 15 years old (19%). Those aged 65 and over make up 15% of the population.


Income distribution of people in households by age

This graph shows where people of different ages are placed in the household income rankings. 

2017-18: People aged 64 and over are found towards the lower end of the household income scale. 41% of all older people are in the lowest 20% income group. Adults of working-age – aged between 25-64 - are located higher up the income rankings, with 48% in the highest two income groups.

Young people – aged between 15-24 - are located in the middle to upper half of the distribution (with 45% in the middle and fourth 20%). This generally reflects the income of their parents, who are likely to be in their peak wage-earning years. Children under 15 years are more likely to be located in the lower to middle parts of the distribution (with 47% in the second and middle 20%). This generally reflects the younger age of their parents, and the fact that parents with young children are likely to have less paid work.

2015-16:  39% of all older people are in the lowest 20% income group. Adults of working-age – aged between 25-64 - are located higher up the income rankings, with 48% in the highest two income groups.

Young people – aged between 15-24 - are located in the middle to upper half of the distribution (with 44% in the middle and fourth 20%).  Children under 15 years are more likely to be located in the lower to middle parts of the distribution (with 47% in the second and middle 20%).


Income distribution of people in households by gender

This graph shows where those identifying as male and female are placed in the household income rankings. Generally, the individual incomes of women are lower than those of men. In 2016, median earnings from paid work (both full- and part-time) for women were 71% of those for men, according to the Australian Bureau of Statistics. However, this website compares income groups based on the income of their household (assuming that incomes are equally shared within households), rather than individual incomes. As a result,  income inequality between men and women can be masked. The impacts of gender inequality only become apparent when women live independently of men.

2017-18: Households with female main earners and children were twice as likely (29%) to be in the lowest 20% by income compared with households with male main earners and children (14%).  Amont sole parent families, the majority of which have female main earners, 29% were in the lowest 20% income group. In contrast, 18% of households with male main earners and children, compared wtih 11% of households with female main earners and children, were in the highest 10% income group.

2015-16: Women are slightly more likely to be in low-income households, with 21% of women located in the lowest 20% income group. This reflects the fact that most sole parent households and older people living alone are households where the reference person is female, and those households are found disproportionately in the lowest 20%. 


Australia’s population by family type

The largest family type is couples with children, at 44% of all households, followed by couples without children and ‘other’ households (including sibling households, multiple family households, and share households), both at 20%. Single person households (most of whom are over 64 years) comprise 9% of the population, and sole parents, 7%.


Income distribution of people by family type

This graph shows where people in different types of families are placed in the household income rankings. Single people are much more likely to be found in the lowest 20% income group – including 42% of single people without children and 36% of sole parents. This is despite the fact that when people are divided into income groups, their household incomes are already adjusted to take account of family size (that is, the incomes of larger families are adjusted downwards - or ‘equivalised’ – to reflect their need for more income to attain the same living standard).

Of all sole parents, 63% are in the lowest 40% by income. This reflects their lower rates of employment and greaterc aring responsibilities, and the relatively low levels of social security payments. According to the Australian Bureau of Statistics, 51% of sole parents are employed compared with 73% of parents in partnered families with children. In contrast, 26% of couples without children are found in the highest 20% income group. It is likely that this is due to the higher earnings and lower financial needs (captured by the equivalence adjustment referred to above) of younger, double-income childless couples and older workers whose children have left home.


Australia’s population by country of birth

This shows that 69% of the population were born in Australia, 10% in a country where mainly English is spoken, and 21% were born elsewhere (in predominantly non-English speaking countries).


Income distribution of people by country of birth

People born in non-English speaking countries (other category) are more likely (at 24%) to live  in the lowest 20% income group. One reason for this is that they come from less-wealthy countries, and another reason is that they are less likely to be approved to settle in Australia on the basis of workforce skills. Of those who entered Australia with permanent visas from 2006 to 2016, 62% of those coming from North-west Europe had skilled visas, compared with 49% of those from South-east Asia and 14% of those from North Africa and the Middle East. For more information, see Australian Bureau of Statistics (2016): Characteristics of Recent Migrants, Australia, November 2016. (‘Recent’ refers to those settling in Australia between 2006 and 2016).

Conversely, people born in Australia or other mainly English-speaking countries are more likely to live in the highest 20% income group, at 25% and 22% respectively.