This week's Monday Briefing looks at who earns what across the UK economy.
One way to think about the range of incomes is to allocate individuals to 100 equally-sized groups or percentiles according to their income.
In the middle of this distribution, at the 50th percentile, incomes stand at £21,400 this year according to HMRC data. This is lower, but more representative of what most people earn, than the average income which is £30,100.
At the top 1% of the income distribution - a part of the population which encompasses many professionals as well as the super rich - average incomes stand at £150,000.
In the bottom 1% of the distribution incomes are £8,430 and consist mainly of state benefits.
This skewed income distribution means that the top 10% of taxpayers receive a third of income and the top half account for three quarters of all income.
If you'd like to see where you belong in the UK income distribution you can use the Institute for Fiscal Studies' ready reckoner: http://www.ifs.org.uk/wheredoyoufitin/
Of course the tax and benefits system redistribute incomes on a large scale. In 2012/13 taxpayers in the top half of the income distribution are forecast to pay 89% of all taxes.
Meanwhile the bottom 40% of households derive almost half of their income from various state benefits.
The burden of tax on those on the highest incomes has risen, with the share of the UK's total tax take financed by the highest 1% of earners rising by a quarter in the last 10 years.
A more limited redistribution occurs through the provision of public services. The value of services from the NHS, state education along with bus and rail subsidies, does not vary much, at around £7600 a year, for households from the bottom of the income distribution to those in the 70% percentile.
At higher household incomes, above about £45,000, the value of these services tails off, in part because richer households make greater independent provision for health and education. Nonetheless, even the richest 10% of households receive, on average, £5643 worth of services through state health care, education and travel subsidies. Interestingly, households in the top 10% of households receive 13 times as much from rail subsidies as households in the bottom 10%.
One obvious implication of the UK's skewed income distribution is that the majority of consumer spending power comes from those on above average earnings.
A combination of tax rises, high inflation and modest growth in earnings have hit consumers across the income spectrum in the last 5 years. But most of the planned tax rises have taken effect, inflation is expected to ease and earnings are likely to edge up. The worst is probably past for incomes in the UK.
MARKETS & NEWS
UK's FTSE 100 ended last week up 1.7%.
Here are some recent news stories that caught our eye:
The US economy created a stronger than expected 236,000 jobs in February and the unemployment rate dropped from 7.9% to 7.7% helped by strong growth in house building
The pound declined to a two and a half year low on worries about the outlook for UK growth
US banks have enough capital to withstand a severe economic downturn, the Federal Reserve says, as 17 out of 18 banks passed its annual stress tests
Bill Gross, who runs the worlds's biggest bond fund, Pimco, and is a long term sceptic about Western growth prospects, has raised his forecast for US growth this year from 1.5% to 3.0%
In a speech UK Prime Minister David Cameron rejected calls for a change in the UK Coalition's strategy of debt reduction
UK retail sales grew at the fastest rate of growth in 3 years according to the British Retail Consortium
UK sales of new cars rose for the 12th consecutive month in February, boosted by manufacturers' deals, according to data from the Society of Motor Manufacturers and Traders (SMMT)
The FT reported that UK Chancellor George Osborne's budget later this month will underscore the case for monetary activism to boost growth, setting the scene for "a new era of looser monetary policy" under incoming Governor Mark Carney
The UK service sector expanded for the second consecutive month, driven by a rise in business confidence, according to survey data
The UK's Daily Mail on line has become the world's most visited on-line newspaper, with a global audience of more than 50 million unique on line users every month
In his annual letter to Berkshire Hathaway shareholders billionaire investor Warren Buffet claimed that "opportunities abound in America"
Britain was the sole dissenter as EU finance ministers backed a proposal for a 1:1 ratio of salary-to-bonus cap for EU bankers, which a supermajority of shareholders can raise to 2:1
Reports suggest the French government is considering replacing its 75% top income tax rate on earnings above €1m with a 65-66% rate on earnings above €2m
The Greek finance minister Yanas Stournaras claimed there will be no more layoffs in the Greek public sector, ahead of the quarterly review of public finances by the country's "troika" of creditors
Greece has been reclassified from a "developed" to an "emerging market" by a major US fund manager, Russell Investments, claiming that it no longer met "macro and operational risk criteria" for developed market status
One of the world's richest men, Prince Alwaleed bin Walal of Saudi Arabia, has severed his ties with the annual Forbes Rich List, believing it to underestimate his wealth by almost $10bn
The US has made the "modest request" to the United Nations that the negotiating rooms at budget debates "should in future be an inebriation-free zone", with committee meetings tending to come over Christmas time and running into the early hours of the morning – UN resolutions
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