One quarter of families were living on incomes of less than €20,000 in 2006 while five per cent of households enjoyed incomes of more than €134,000, a new report on income inequality has found.
The Hierarchy of Earnings, Attributes and Privilege report (HEAP) was commissioned by the equality think-tank Tasc and the Irish Congress of Trade Unions (Ictu) to establish the extent of income inequality. It found that 58 per cent of families were living on less than €40,000 per year.
When analysed in terms of occupation, only the managerial or professional categories had annual household incomes of €600,000.
The study by NUIG academics Prof Terrence McDonough and Jason Loughrey found that income distribution became more unequal between 1987 and 2005 as the distance between those at the top and those at the bottom widened. It found that social welfare payments played a key role in reducing poverty levels from 21.9 per cent in 2001 to 16.5 per cent in 2007.
The study also found that women’s income was around two-thirds of men’s income. When adjusted for differences in hours worked, women’s hourly earnings were around 86 per cent of men’s.
The role of education in improving income was also highlighted by the researchers. The average gross income of those with no formal education, or primary education only, was €13,489, while those with a university degree had an average income of €45,707.
Tasc and Ictu have produced a poster illustrating the numbers of households at different income levels, broken down by occupational category and household type, together with an explanatory booklet. It will be distributed to schools around the country in the coming months.
Ictu general secretary David Begg said the poster was a graphic illustration of our clearly divided society. He said it would be used in Ictu’s campaign against imposing the burden of the recession on low and middle income earners.
“If Government had any intention of forging a new and more equal Ireland out of this mess, it would study this report closely and act decisively to ensure nothing like it could ever be compiled again. We won’t hold our breath”.
Tasc director Paula Clancy said Ireland was a society “built on inequality” and a very small group of people had benefited enormously from the boom. She highlighted the 26 per cent of families living on less than €20,000 and said “any moves to cut social welfare really should be avoided”.
Prof McDonough said the data was drawn from surveys carried out in 2006 but if there was a change in people’s circumstances since, it was for the worse, rather than the better. “While incomes across the board are reduced, the structure of overall income inequality still applies,” he said.
