What is the typical income in Australia? This list shows the income of hundreds of professions
Do you find it confusing that people talk about median and average incomes?
It is easy to do.
When the Australian Taxation Office released new data on typical income a few weeks ago, you may have looked at the data and found it hard to relate to.
This may be because the word “average” has been used a lot, and averages can be really misleading.
If you want to compare your income to everyone else’s, the “median” income is a much better place to start.
Scroll down to see what this means.
You’ll also see a chart that shows you how much workers are paid in hundreds of different occupations in Australia.
Why averages can be so misleading
According to the Australian Taxation Office (ATO), the average taxable income in the 2019-20 financial year was $63,882.
But the median was much lower at $48,381.
The big difference between the two reveals why averages can be so misleading.
The “median” is better because it refers to the environment of income distribution.
It marks where half of all workers have taxable income above this number, and half have taxable income below.
Why is the average taxable income so much higher than the median?
This is because the income of some exceptionally well-paid people pushes the average up.
For example, suppose there are 10 people in a room: nine of them earn $10,000 per year and one of them earns $500,000 per year.
What is the average?
In total, they earn $590,000 a year. So the average income in this room would be $59,000 ($590,000 divided by 10 people).
Notice how, due to the very high income of a single person, the average income of the group is a lot higher than the typical income of 90% of the people in the group?
This is how averages can be misleading.
You can break it down further
So knowing why the median is a better guide to “typical” income is a good place to start.
But you might look at that national median income of $48,381 and think it still doesn’t match your reality.
So let’s take another step.
The ATO publishes more granular data on the subject, starting with a breakdown for men and women.
In 2019-2020, the average taxable income of Men has been $74,559and the median was $56,746.
But the average taxable income for women it was $52,798 while the median was $41,724.
What about the different professions?
Then you can go even further and look at what different professions pay.
The ATO publishes taxable earnings for hundreds of occupations each year and breaks them down by their average and median earnings for men and women.
See table below.
Think of any profession you want and type it into the search box in the top left corner of the table.
For example, are you curious to see what economists earn?
Type “economist” in the search field.
It shows that there were 3,609 economists (excluding land economists) in 2019-20 and their average taxable income was $147,358while their median taxable income was $117,288.
These numbers are much higher than the national median and average. This could perhaps explain why some economists seem to struggle to understand how millions of Australians live.
Need more ideas for what to type?
Try these professions: teacher, nurse, policeman, laborer, mason, mechanic, bartender, deputy, surfer, footballer, mushroom grower.
After typing your profession in the search field, you may need to browse a few pages to see the specific profession you are looking for.
The toggle buttons are in the upper right corner of the table.
What about retirement pension?
And finally, there may come a time when you start thinking about your retirement savings.
How does your super stack up against all the others?
This is an area where medians and means make a big difference, along with age and gender.
There are quite a few people who have huge sums of money stashed away in their super accounts, and that’s driving up the national average deceptively.
Men also have much larger super balances than women, overall, as they tend to take less time off work to care for children or loved ones, and male-dominated occupations tend to pay more, among a whole list of other reasons.
In 2019-20, the average super balance in Australia was $145,388but the median super-equilibrium was only $49,374.
For men, the average superbalance was $161,834 and the median was $56,425. For women, the average was $129,506 and the median was $44,634.
But notice this.
When looking at your super balance, it’s worth comparing yourself to people in your age group because the super depends so much on the life cycle.
See graph below.
It shows the median super balance for males and females in different age groups.