About 4 in 10 middle-class individuals saw their earned and business incomes decrease.

The proportion of those with reduced incomes was the highest in four years since 2020, when the shock of COVID-19 struck.

According to the 2024 Income Mobility Statistics released by the Korea Data Service on November 1, among individuals who belonged to the 3rd quintile (middle class) based on earned and business income in 2023, 38.9% experienced a drop in income the following year.

This is the highest level since 2020 (41.2%) during the COVID-19 pandemic.

The proportion of income reduction fell for three consecutive years—recording 38.6% in 2021, 35.8% in 2022, and 35.2% in 2023—before reversing course in 2024 with a 3.7 percentage point (p) rise.

The proportion of those whose income plummeted by 50% or more rose 0.5 percentage points from the previous year to 12.8%.

This means that 1 out of every 3 individuals (32.9%) with decreased income saw their earnings shrink to less than half.

On the other hand, the proportion of those whose incomes increased stood at 57.3%, down 5.7 percentage points from the previous year (63.0%).

This is the lowest level since 2021.

The proportion of those whose income surged by 50% or more fell 2.3 percentage points to 9.7%, recording the lowest level since relevant statistics began in 2018.

Among income quintiles 1 to 5, the proportion of income decrease rose the most in the 3rd quintile.

The figures rose for the other quintiles as well: the 2nd quintile went up by 2.5 percentage points (38.0% to 40.5%), the 4th quintile by 3.3 percentage points (33.2% to 36.5%), and the 5th quintile by 1.0 percentage point (34.1% to 35.1%).

Conversely, the 1st quintile dropped by 0.2 percentage points (29.3% to 29.1%).

This year, the economic growth rate is projected to climb into the 3% range driven by the semiconductor boom, but observations suggest that the warmth of economic recovery may be concentrated relatively among high-income earners.

An official from the Data Service explained, "Performance-based bonuses and benefits in certain manufacturing sectors, such as semiconductors, tend to be concentrated in the 4th and 5th quintiles, which are largely comprised of middle-aged people in their 30s and 40s," adding, "For middle-income brackets like the 3rd quintile, there may be limits to directly feeling the warmth of this export boom."

The Bank of Korea also analyzed in a report titled "Why Is This Terms-of-Trade Improvement Different," published last July, that wage increases and capital gains stemming from the recent semiconductor market boom are concentrated among high-income and high-asset groups, which have relatively lower marginal propensity to consume and asset effects.