Income

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Having sufficient income contributes substantially to wellbeing. With an adequate income, an individual or household can access essential goods and services more easily, such as quality housing, transport, food, health services, and education. An adequate income also enables participation in social and recreational activities in the community.

Household income affects both day-to-day decisions and activities and future prospects for all age groups. The inter-generational effects of family income levels are far reaching. The ‘chicken-and-egg’ relationships between enabling young people’s educational attainment, and their future work prospects, income, housing, neighbourhood characteristics, and their health-promoting activities in adulthood are well known [1-3]. Through these various mechanisms, children who experience well-resourced family life in the early years are more likely to experience good health and wellbeing across the life course [4,5]. Not only do people with higher levels of income live longer, but they live longer in better health [2]. However, some groups are more at risk of low income than others, including people experiencing mental illness, people with disabilities, young people, lone parents, and some ethnic groups [4].

Income inequities can increase the likelihood of social isolation and marginalisation and can influence mental health, physical health, and health behaviours, for example through feelings of stress and lack of control.

Key trends within income

The median equivalised gross weekly household income in greater Christchurch increased steadily from early 2012, coinciding with the upsurge in earthquake recovery and rebuild activities. This upward trend has tended to flatten over the last two to three years, and the median weekly income for greater Christchurch now appears to be converging with the New Zealand median weekly income level.

Median equivalised gross weekly household income net of housing costs for home owners has increased steadily for those in greater Christchurch over the last ten years, consistent with the pattern for New Zealand overall. For greater Christchurch renters, household income net of housing costs increased more steeply than for New Zealand overall, for the period 2011 to 2016 but has now converged with the New Zealand level.

The 20th percentile equivalised gross weekly household income (the dollar amount below which a household is considered to have a ‘low’ income) increased substantially in greater Christchurch from 2008 to 2017, from $531 to $703, and appears to be continuing at a higher level compared with the whole of New Zealand. However, the difference between greater Christchurch and New Zealand has reduced substantially since the high points of 2013 and 2014.

Approximately two-thirds of greater Christchurch respondents indicated that they were satisfied or very satisfied that their household income meets everyday needs in 2017, and this proportion remained unchanged in 2018.

Taken together, the changes in the income indicators for greater Christchurch, over the last two to three years, suggest a plateau or an easing of rebuild-related economic activity.

Key equity issues within income

Median equivalised gross weekly household income data for greater Christchurch show a substantial income disparity between Māori and non-Māori ethnic groups. And, while the overall trend for 20th percentile equivalised gross weekly household incomes in greater Christchurch appears to indicate a steady increase, this trend is less pronounced for Māori compared with non-Māori. Finally, Europeans’ satisfaction with their household income appears higher than Pacific/Asian/Indian respondents’ and Māori respondents’ levels of satisfaction. Taken together, these results suggest that Māori households and Pacific/Asian/Indian households may not have benefitted from the boosts in post-earthquake economic activities in greater Christchurch to the same extent as other ethnic groups.

What this means for wellbeing

The overall picture for income in greater Christchurch is a positive one, with noteworthy increases in equivalised gross weekly income, household income after housing costs (particularly for renters), and 20th percentile household incomes, over the last five years. These indicators reflect a post-earthquake recovery-related economic boost across the region since approximately 2012, and a positive contribution to greater Christchurch residents’ wellbeing. However, the favourable trends appear less pronounced in more recent years. Further, these data also suggest that the improvements seen in the income indicators are not uniform across the whole population and ethnicity and age-based differences in residents’ income levels are evident.

References

  1. Braveman P, Sadegh-Nobari T, Egerter S (2011) Early Childhood Experiences and Health. Exploring the Social Determinants of Health. Issue Brief# 2, Robert Wood Johnson Foundation.
  2. Marmot M (2004) Social Causes of Social Inequalities in Health In: Anand S, Peter F, Sen. AK, editors. Public health, ethics, and equity. Oxford: Oxford University Press on Demand.
  3. Marmot M, Bell R (2012) Fair society, healthy lives. Public Health 126: S4-10.
  4. Kawachi I, Kennedy BP (1997) Health and social cohesion: why care about income inequality? BMJ 314: 1037-1040.
  5. Meyer S (2002) The influence of parental incomes on children’s wellbeing. Wellington: Knowledge Management Group, Ministry of Social Development, Te Manatu - Whakahiato Ora.
  6. Statistics NZ (2013) Census QuickStats about income. Retrieved from http://archive.stats.govt.nz/Census/2013-census/profile-and-summary-reports/quickstats-income/personal-income-ethnic.aspx
  7. Perry B (2017) Household incomes in New Zealand: Trends in indicators of inequality and hardship 1982 to 2016. Wellington: Ministry of Social Development.
  8. Hyslop D, Suresh Yahanpath S (2005) Income Growth and Earnings Variations in New Zealand, 1998—2004: New Zealand Treasury working paper 05/11. Wellington: New Zealand Treasury.
  9. Levin KA, Torsheim T, Vollebergh W, Richter M, Davies CA, et al. (2011) National Income and Income Inequality, Family Affluence and Life Satisfaction Among 13 year Old Boys and Girls: A Multilevel Study in 35 Countries. Social Indicators Research 104: 179-194.
  10. Diener E, Tay L, Oishi S (2013) Rising income and the subjective well-being of nations. J Pers Soc Psychol 104: 267-276.
  11. Diener E, Ng W, Harter J, Arora R (2010) Wealth and happiness across the world: material prosperity predicts life evaluation, whereas psychosocial prosperity predicts positive feeling. J Pers Soc Psychol 99: 52-61.
  12. Kahneman D (1999) Objective happiness. In: Kahneman D, Diener E, Schwartz N, editors. Well-being: The foundations of hedonic psychology. New York: Russell Sage Foundation. pp. 3–25.
  13. Sengupta NK, Osborne D, Houkamau C, Hoverd WJ, Wilson MS, et al. (2012) How much happiness does money buy? Income and subjective well-being in New Zealand. New Zealand Journal of Psychology 41: 21-34.