Seoul: South Korea's average household income experienced a 4.5 percent increase in the second quarter of 2026 compared to the previous year, largely driven by rises in wage and transfer income, as reported on Thursday.

According to Yonhap News Agency, the Ministry of Data and Statistics revealed that the average monthly household income reached 5.29 million won (US$3,810) between April and June. In a separate announcement, the finance ministry indicated that inflation-adjusted household income saw a 1.5 percent uptick.

The average monthly wage income slightly increased by 0.8 percent from the previous year, amounting to 3.21 million won, though its growth was restrained by a decline in the number of wage workers and slowing wage increments. Business income averaged 977,000 won monthly, marking a 3.8 percent rise amid robust retail sales.

Transfer income saw a significant jump of 20.4 percent to 931,000 won, attributed to government cash subsidies aimed at alleviating high fuel costs. Property income also rose by 21.3 percent, averaging 67,000 won per month.

Monthly household spending increased by 3 percent to 3.99 million won. Within this, consumption spending-which includes household purchases of goods and services-rose by 3.4 percent to 2.9 million won, marking a 22-quarter streak of gains. However, when adjusted for inflation, the growth rate was 0.4 percent.

The rise in household spending was primarily due to increased expenditure in household goods and services, as well as the restaurant and hotel sectors. Conversely, spending on transportation, alcoholic beverages, and tobacco declined. Non-consumption spending, encompassing taxes and insurance premiums, increased by 1.9 percent to 1.06 million won, driven by higher interest and social insurance costs.

Households within the bottom 20 percent income bracket saw their average monthly income rise by 7.5 percent year-on-year to 1.28 million won. Meanwhile, those in the top 20 percent earned an average of 11.1 million won per month, a 3.8 percent increase from a year earlier. Income rose across all income brackets, contributing to a decrease in income inequality, as evidenced by the ratio of average equivalized disposable income between the top and bottom 20 percent declining to 4.97 in the second quarter, down 0.48 from the previous year.