In 2024, the economic standard, which is disposable income adjusted for household size, increased. The inflation-adjusted median value rose by 1.8 percent compared with 2023.

– The increase in 2024 still isn’t enough to reach the same level as the peak year of 2021, since the economic standard dropped in both 2022 and 2023 due to high inflation, says Peter Gärdqvist at Statistics Sweden.  

Low economic standard most common among children and young people

The share of people with a low economic standard, defined as having less than 60 percent of the median value for the entire population, was 13.1 percent in 2024. This represents a slight decrease compared with 2023 and is the lowest level since 2007. The highest share recorded so far, 14.7 percent, was measured in 2021.

There are significant differences between age groups. In 2024, individuals aged 65–79 had the lowest share of low economic standard, at 8.6 percent. This share has declined in recent years, partly because more people are working at older ages. Over time, even those aged 50–64 have consistently had low proportions of low economic standard. A contributing factor is that they have fewer children living at home compared to younger age groups.

People aged 80 and older have previously been the group with the highest share of low economic standard, but that share has fallen sharply and was 12.1 percent in 2024. One explanation is that pensions and certain other benefits aimed at low-income retirees are linked to the price base amount and have therefore increased significantly in recent years.

– Over the past two years, relatively low income has instead been most common among children and young adults up to age 29. In those groups, 17 percent had a low economic standard, says Peter Gärdqvist.

Capital income behind increasing income inequality

While the economic standard rose in 2024, income inequality also increased. A key measure of income inequality is the Gini coefficient, which ranges from 0 (everyone has the same income) to 1 (one person has all income). In 2024, the Gini rose slightly to 0.314, indicating a somewhat more unequal distribution compared with 2023, when it was 0.310. However, if capital gains and other capital income are excluded from the calculation, the Gini remained unchanged from 2022 to 2024, at 0.246.

Different types of income affect income inequality in different ways. The chart below shows a so-called decomposition of the Gini coefficient. Wage and business income, as well as capital income, are the income types that contribute to greater inequality. Capital income is more unevenly distributed, but wage and business income have a larger impact on overall income disparities because the amounts are significantly higher. Compared with 2011, wage and business income have had a slightly smaller effect on the Gini in recent years, partly because wages account for a smaller share of disposable income.

– Capital income has taken on a greater weight in the Gini calculation, which has largely driven the trend toward greater income inequality in recent years, says Peter Gärdqvist

Negative transfers, primarily taxes, have an equalizing effect on income distribution, as illustrated by their position well below the zero line in the chart.

Positive transfers consist of several different types of income, including pensions, social insurance benefits, student aid and means-tested allowances. Pensions contribute to a slight increase in the Gini coefficient, while other transfers reduce it. Overall, transfers have only a minor impact on the Gini value.