Credit Suisse just came out with their excellent ‘Global Wealth Report’ for 2019. I will likely do a more in-depth report in The Leading Edge earlier in the New Year.
The focus is on wealth, but the income statistics are even more illuminating in this time of peak inequality. I especially like their comparisons per adult as opposed to per capita or per household.
Adults are the people who spend their own money — whether it be earned or saved. Minors are spent on, and it is a lifestyle choice to have kids or not — as well as to have a certain number of them. Of course, if you have more kids you will have less income per person. But people who choose that typically prefer that for their lifestyle. So, this is the best measure to me of how much income and spending power people have in different countries.
Then there are the comparisons of income in PPP, or purchasing power parity. I like that comparison, as well, and it works best for measuring how the standard of living grows with urbanisation. But although countries with lower costs of living makes life more affordable, there is a quality of life factor that is also a choice. New York or London or Sydney or Geneva or Singapore may cost more to live, but they are considered worth it due to their immense choices and lifestyle quality.
So, in this article, I will show the GDP per adult for the developed countries over five million in population — and there is a great variance, from $30.9k to $108k.
Source: Global Wealth Databook 2019
First, note the three highest countries, as they all have some exceptions for their high achievements here. Ireland is the highest, but it is a small country with strong tax incentives to attract multinational companies with high paying jobs. Norway is a small country with high relative oil revenues, like a mini Saudi Arabia. Switzerland is the most expensive country in the world, typically with high-value exports. Their companies have to pay more for the privilege of being there.
The US really stands out here, as it is a very large country with a high ratio of lower-income immigrants. At $85.3k, it is 7% higher than Singapore that has a 100% urban population and attracts the best of Asia. I did not expect the US to outperform it on this measure. The US is also 44% higher than Hong Kong, which is also 100% urban and attracts the best of Asia.
I look at Belgium here as being right in the middle — like the median — at $59.4k. The US is 44% greater than that. The other countries in Europe that stand out are Denmark, Sweden, and the Netherlands — very northern.
Outside of Ireland, the US is also the strongest of our cousins, the English Offshoots. Australia at $76.0k is only 11% lower than the US, and they don’t work as long hours. Canada at $59.2k is a surprising 31% lower than the US. New Zealand comes in at $58.7, also 31% lower. All the offshoots have now surpassed the UK, and at $55.2 it is 35% lower than the US.
Spain is the lowest in Europe at $38.1k now, about the same as its Spanish cousin Puerto Rico at $37.6k. Kudos to my new home country, which was still an emerging country a few decades ago. Taiwan is the lowest at $30.9k, which was also a surprise to me and likely reflects its still restrictive ties to China.
The US still looks surprisingly good. Too bad we look to peak and fade by 2036–37 at the top of the next global boom.