Income Mobility Stalls: Only 20% Climb the Ladder, Widening Gap Between Rich and Poor
Among those who shifted income brackets, only 17.3% moved upwards, not significantly different from the 16.8% who moved downwards. This suggests a lack of dynamic income mobility, raising concerns that socio-economic inequality is becoming entrenched. A stark difference in income bracket retention rates between high- and low-income groups further underscores the difficulty of upward mobility.
The top 20% (5th quintile) boasts a very high income bracket retention rate of 85.9%, demonstrating their ability to maintain their economic standing. In contrast, the bottom 20% (1st quintile) has a retention rate of 70.1%. While lower than the top quintile, this is still relatively high, reflecting the difficulty for those in the lowest income bracket to escape poverty. These results indicate deepening income inequality and a breakdown in the ladder of opportunity.
Examining income mobility from a long-term perspective reveals even more concerning issues. Among those in the bottom 20% in 2017, 27.8% remained in the same bracket through 2023, indicating the persistent challenges of escaping poverty. Even more alarming is that 59.3% of those in the top 20% in 2017 remained there in 2023. This can be interpreted as the wealthy passing down their wealth, solidifying their socio-economic position.
Marginal differences were observed in income mobility based on gender. In 2023, the upward mobility rate for men was 16.6%, while for women it was slightly higher at 18.1%. This could be attributed to increased female participation in the workforce and improvements in women's social standing, leading to higher income levels. However, women still face challenges such as wage gaps and job insecurity compared to men, requiring greater effort to climb the income ladder.
This report from the National Data Center reveals the significant challenges facing President Lee Jae-myung's administration. Addressing income inequality and promoting income mobility require urgent policy action, particularly tailored support for low-income and younger populations. Furthermore, there is a need to prevent the intergenerational transfer of wealth among the wealthy and create a fair competitive environment for all. Based on these statistical findings, the government must develop and implement more effective policies to build a society where all citizens can thrive.
