According to data released by the OECD, last year, all countries in the organization for which data were available – except Finland and Australia – recorded growth in real income per capita, with Portugal standing out with the largest increase, of 6.7%, “driven mainly by workers’ compensation and a decrease in taxes paid”.
Australia, on the other hand, recorded the largest decline (-1.8%), although this improved from the record 5.1% fall recorded in 2023, “driven mainly by higher interest and tax payments”.
Across OECD countries, real per capita household income grew by 1.8% in 2024, slightly above the 1.7% in 2023.
According to a note from the OECD, the annual increase in real per capita household income observed in 2024 in most of the organization’s member countries occurred in the wake of the slowdown in inflation compared to the previous year.
Considering only the fourth quarter of last year, real household income per capita in the OECD increased by 0.5% compared to the previous three months, accelerating compared to the 0.2% quarter-on-quarter increase recorded in the previous quarter, while real GDP per capita grew by 0.4%.
Despite this overall increase in the last quarter of 2024, the picture was mixed across OECD countries: Of the 19 countries for which data are available, nine recorded an increase, seven a decrease and three recorded no change.
Among the G7 economies, real per capita household income grew (in a chain fashion) in only two countries – the UK and the US – while the others suffered contraction or stagnation.
The UK recorded an increase (1.5%), driven mainly by workers’ compensation and social benefits, while real GDP per capita decreased slightly (-0.1%).
The US, on the other hand, saw more moderate growth in real household income per capita (0.3%), also driven mainly by worker compensation, while real GDP per capita increased by 0.5%.
Italy recorded a decline (-0.6%), partly due to a decrease in net property income and an increase in social contributions, while GDP grew slightly (0.1%).
In turn, Germany suffered declines in both real household income per capita and real GDP per capita (-0.5% and -0.2%, respectively).
Canada and France, on the other hand, recorded a halt in the growth of real per capita household income (from 1.4% and 0.9%, respectively, in the previous quarter, to 0.0% in the fourth quarter of 2024).
