OECD Household Income Growth Sees Significant Slowdown

(MENAFN) Real household income per capita across countries in the Organization for Economic Cooperation and Development (OECD) edged up by just 0.1% year-over-year in the first quarter of 2025, according to a report released by the group on Thursday.

This marks a significant slowdown from the 0.6% growth rate recorded in the final quarter of 2024.

Similarly, real gross domestic product (GDP) per capita also rose by 0.1% in the same period, decelerating from a 0.4% increase in the previous quarter.

"Despite the overall growth in real household income per capita, the picture was mixed across OECD countries," the OECD said in its statement.

Of the 20 member nations with available data, results were evenly split: half experienced an increase in household income, while the other half reported declines.

Italy posted a 1% rise in household income, recovering from a previous-quarter contraction. The rebound was "supported mainly by remuneration of employees and net property income, while real GDP per capita also grew (0.4%)."

In the United States, household income continued to rise by 0.5%, largely due to increased employee compensation and social benefit programs from the government. However, GDP per capita in the U.S. declined by 0.3% during the same period.

In contrast, both the United Kingdom and Germany experienced drops in household income—1.3% and 0.4% respectively.

GDP per capita in those two countries moved in the opposite direction, increasing by 0.5% in the UK and 0.3% in Germany.

"The fall in real household income per capita in the United Kingdom followed a relatively large increase in Q4 2024, while in Germany it marked the second consecutive quarter of decrease," the OECD noted.

Among other member states, Chile recorded the strongest growth in household income at 3.1%, while Portugal registered the sharpest decline, with a drop of 4.5%.

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