South Korea’s Household Income Expands in Q4 2025
On a nominal basis, monthly average income per household climbed 4.0% year-on-year to 5,422,000 won ($3,800) in the October-December quarter — sustaining an unbroken streak of gains stretching back to the third quarter of 2023. Adjusted for inflation, real household income posted a 1.6% annual increase over the same period.
Earned income, the largest component, rose 3.9% to 3,369,000 won ($2,360) in the fourth quarter — a sharp acceleration from the 1.1% growth recorded in the preceding three months. Business income expanded 3.0% to 1,124,000 won ($790), while transfer income surged 7.9% year-on-year. Property income, however, contracted 8.9% over the same period.
Spending Accelerates Alongside Income
Household expenditure also picked up pace. Monthly average spending climbed 4.4% annually to 4,081,000 won ($2,860) in the fourth quarter. Consumption expenditure rose 3.6% to 3,008,000 won ($2,110) — well ahead of the prior quarter's 1.3% increase — while inflation-adjusted real consumption expenditure posted a 1.2% gain, marking its first quarterly rebound in a full year.
Categories driving spending growth included transport, miscellaneous goods and services, and food and non-alcoholic beverages, while outlays on health, education, housing, and utilities each edged lower in single digits.
Non-consumption expenditure — covering taxes, social insurance premiums, and interest payments — jumped 6.5% to 1,073,000 won ($750). Monthly disposable income, calculated as nominal income minus non-consumption expenditure, rose 3.4% to 4,349,000 won ($3,050). The average consumption propensity inched up 0.2 percentage points to 69.2%.
Wealth Gap Widens Despite Broad-Based Gains
Despite the headline growth, income inequality deepened in the quarter. Households in the bottom 20% income bracket saw monthly average income grow 4.6% to 1,269,000 won ($890), while those in the top 20% recorded a steeper 6.1% rise to 11,877,000 won ($8,320) — nearly a ninefold gap between the two groups.
On the spending front, bottom-bracket households increased consumption expenditure by 5.7% to 1,464,000 won ($1,030), outpacing the 4.3% rise recorded among the top bracket, where average monthly spending reached 5,110,000 won ($3,580).
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