Lay-off puts a dent in the wallet — the income of a high-income family contracts the most due to lay-off

Forecast Publications, Representative Households Ilkka Kiema, Heikki Taimio, Hannu Karhunen, Sakari Lähdemäki, Aila Mustonen, Essi Lindberg, Elina Pylkkänen, Julia Niemeläinen, Henri Keränen

Representative Households 2020–2022

The Labour Institute for Economic Research’s (PT) example household calculations examine seven households. The calculations describe the effects on families’ purchasing power of the development of earned income, income transfers, and taxes and tax-like payments. Family-specific consumption baskets are calculated for the households, enabling assessment of family-specific rates of inflation and real income development. On this occasion, the calculations also examined a scenario in which both parents in three wage-earner households are laid off for three months due to the coronavirus crisis. The income of the high-income family decreases the most as a result of lay-off both in euro terms and in percentage terms, because for high-income earners the daily allowance covers the smallest proportion of a normal month’s wage income. (AI translation)

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