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Income spent on food, rent at six-year high for poor
By Korea HeraldPublished : March 12, 2012 - 20:38
The portion of monthly expenditure that low-income households spend on food and housing hit a six-year high last year, Statistics Korea said.
The Engels coefficient, which measure the portion of spending taken up by food and beverages, reached 20.7 percent last year, the highest level since 2005. The state-run agency also said that those in the lowest-income bracket devoted another 18.8 percent of their income to rent and mortgage payments last year.
“Poor people are increasingly burdened by basic necessities, not only because of inflation over the past year, but also as more are pushed to turn to mortgage loans,” a Statistics Korea official said.
The Engels coefficient of 20.7 percent is higher than the average of 14.18 percent for those in other income brackets, who earn more and thus spend less on food. The figure for the top 20 percent earners came in at 11.83 percent year, almost half of the portion the bottom 20 percent does.
Monthly mortgage interest rate payments for all households last year reached 18.80 percent, a record high since the agency began compiling the data in 2003. Households with at least two family members spend 722,280 won a month on average for non-consumption items, including mortgages and taxes, up 0.24 percent from 2010.
This is the first time that the percentage of non-consumption spending has reached more than one-fifth of total income. Non-consumption expenses also include pension and health insurance, which are normally deducted automatically from monthly income and reduces disposable income.
Their monthly average income came in at 3.84 million won last year.
By Cynthia J. Kim (cynthiak@heraldcorp.com)
The Engels coefficient, which measure the portion of spending taken up by food and beverages, reached 20.7 percent last year, the highest level since 2005. The state-run agency also said that those in the lowest-income bracket devoted another 18.8 percent of their income to rent and mortgage payments last year.
“Poor people are increasingly burdened by basic necessities, not only because of inflation over the past year, but also as more are pushed to turn to mortgage loans,” a Statistics Korea official said.
The Engels coefficient of 20.7 percent is higher than the average of 14.18 percent for those in other income brackets, who earn more and thus spend less on food. The figure for the top 20 percent earners came in at 11.83 percent year, almost half of the portion the bottom 20 percent does.
Monthly mortgage interest rate payments for all households last year reached 18.80 percent, a record high since the agency began compiling the data in 2003. Households with at least two family members spend 722,280 won a month on average for non-consumption items, including mortgages and taxes, up 0.24 percent from 2010.
This is the first time that the percentage of non-consumption spending has reached more than one-fifth of total income. Non-consumption expenses also include pension and health insurance, which are normally deducted automatically from monthly income and reduces disposable income.
Their monthly average income came in at 3.84 million won last year.
By Cynthia J. Kim (cynthiak@heraldcorp.com)
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Articles by Korea Herald
