Sunday, May 13, 2012

Ever-Shrinking Earnings

Eitan Bluer

The level of household income provides a basis for various indices that can be used to measure conditions within cities, including poverty level, socio-economic standing of cities, and so on. The level of household income can also explain why in recent years more and more households with at least one wage earner are unable to break out of the cycle of poverty.

In 2010 Jerusalem had about 194,000 households, of which in approximately 60% the head of household was employed. The average net monthly household income in Jerusalem was NIS 10,700. This figure was 23% lower than the average monthly income per household in Israel (NIS 13,900), 28% lower than the average monthly income in Tel Aviv (NIS 14,800), and 24% lower than the average monthly income in Haifa (NIS 14,100). The principal source for the gross monthly income of Jerusalem households whose head of household was employed was earnings from employment (85%). The other sources of income included capital, property, pensions, social security benefits, and so on. Interestingly, social security benefits constituted 8% of all income in those households headed by salaried employees. This percentage was higher than the figure for Israel (6%), Tel Aviv (4%), and Haifa (5%).

The average household size varies significantly among the major cities. It is important, therefore, to measure the level of income per number of individuals in the households (income per standard person). Jerusalem is characterized by households with a high average number of persons (4.3 persons) compared to Tel Aviv (2.5 persons) and Israel (3.7 persons). A weighted assessment of these statistics reveals that in 2010 the average net monthly income in Jerusalem per standard person measured NIS 3,300. This was 30% lower than the average income for Israel (NIS 4,700), 50% lower than the average for Tel Aviv (NIS 6,600), and 42% lower than the average for Haifa (NIS 5,700). 



Source: Central Bureau of Statistics, Income Survey for 2010



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