Average income and real income

People buy fruits and vegetables at a supermarket in Ho Chi Minh City - Photo: QUANG DINH

The Ministry of Labour, Invalids and Social Affairs has just announced that in the first six months of 2024, the average income of workers was 8.4 million VND/month, an increase of 567,000 VND/month compared to the same period last year. This is encouraging news, but it also raises some concerns among readers.

Social statistics serve as the primary basis for formulating policies and solutions. Based on these findings, the government can be assured that people's income levels have increased and living standards have improved. Therefore, some policies can be postponed, such as not needing to increase personal allowances or extend the 2% reduction in value-added tax...

Do these statistics really bring us peace of mind and encouragement?

For those in the know, statistics like these are meaningless and can even be misleading.

Average income is the sum of the different income levels, from minimum to maximum, of various individuals and groups, and then divided to get the average.

Thus, it implicitly fails to give us an accurate picture of the economic situation of society at a specific time with specific individuals. This is similar to a poverty reduction program report stating that people's lives have improved, with each household receiving an average of half a chicken per meal, but in reality, one household eats a whole chicken, while another eats rice with salt (!).

Furthermore, the concept of "worker" seems too general and does not reflect real life.

Who is eligible for this additional 567,000 VND/month? Are they civil servants, industrial park workers, company employees, or self-employed individuals and street vendors?

The reality is that the lives of most people are very difficult; production is stagnant, many factories have no orders, leading to mass job losses, and those who are employed are experiencing reduced incomes; the real estate market is frozen, housing construction sites are quiet, causing the large workforce involved in construction, material production, and trading to struggle; people are tightening their belts, leading to a slump in services, shops closing, and many types of services, including food and beverages, struggling to survive...

Accurately determining the actual income of each group of people and each sector will help the Government make the right decisions regarding subsidies for truly disadvantaged groups; debt relief and debt restructuring for units in temporarily struggling sectors; preferential loans for groups with opportunities for recovery; and breakthroughs in key areas that can change the system to increase labor productivity and expand production scale.

Having a clear understanding of the true state of their economies and people's lives, most countries in the region, such as Singapore, Thailand, Malaysia, and Indonesia, have launched multi-billion dollar support packages for individual households to improve living standards and stimulate consumption.

To achieve this, of course, governments already have the necessary and sufficient information on each individual and household to inform important policy decisions.

The kind of vague, general information and statistics, and predictions with little scientific basis, need to change.

This benefits not only the Government, the National Assembly, and provincial and city authorities, but also every citizen. With relatively complete information, people will know where to invest their finances, what professions to learn, and how to orient their livelihoods...

Source: https://tuoitre.vn/thu-nhap-binh-quan-va-thu-nhap-thuc-te-20240829080121292.htm