THE OECD latest Study has revealed that the growth in real household income per capita has slowed to 0.3 % in the OECD area in the second quarter of 2018, compared with 0.7% in the first quarter of 2018. This contrasts with real GDP growth per capita picking up to 0.6% (from 0.4% in the first quarter of 2018).

In the United States and the United Kingdom, growth of real household income per capita slowed to 0.4% and 0.3%, respectively in the second quarter of 2018. In the United States, growth of real GDP per capita accelerated to 0.9% (from 0.4% in the previous quarter), thus significantly outpacing real household income per capita growth. In the United Kingdom, growth of real household income per capita was marginally higher than real GDP per capita growth (0.2% in the second quarter of 2018).

In Canada, growth of real household income per capita picked up to 0.1% in the second quarter of 2018, compared to minus 0.2% in the first quarter of 2018, while growth of real GDP per capita accelerated to 0.4% (from 0.1% in the first quarter of 2018).

In the European Union and in the euro area, real household income per capita rose by 0.5%, marginally more than the 0.4% growth in real GDP per capita.

In Italy, growth of real household income per capita jumped to 1.6% in the second quarter of 2018 from minus 0.4% in the first quarter, significantly outpacing growth of real GDP per capita (which slowed to 0.2% in the second quarter).

In France, growth of real household income per capita also picked up strongly, to 0.5%, in the second quarter of 2018 compared to a contraction of 0.5% in the previous quarter. Growth of real GDP per capita, was stable at 0.1% in the second quarter of 2018.

By contrast, in Germany, growth of real household income per capita decelerated to 0.1% in the second quarter of 2018 (following an increase of 1.2% in the previous quarter), while growth of real GDP per capita accelerated slightly to 0.4%.

Over the last nine quarters, in the OECD as a whole, growth in real GDP per capita outpaced growth in real household income per capita by 0.7 percentage point. Among the Major Seven economies, the gap was largest in the United Kingdom (1.7 pp), followed by France (1.2 pp), Italy (0.5 pp), Germany (0.3 pp) and the United States (0.2 pp). On the other hand, in Canada, growth in household income per capita significantly outpaced growth in real GDP per capita (2.8 pp).

Since the first quarter of 2010, among the Major Seven economies, the gap between growth in real household disposable income per capita and real GDP per capita was highest in the United Kingdom (7.1 pp), while in the United States and Canada, growth in real household income per capita outpaced growth in real GDP per capita by 3.0 pp and 0.3 pp, respectively. The European Union as a whole also showed a considerable negative gap between real growth in per capita household income and GDP (6.8 pp).