PETALING JAYA: The mean monthly household gross income in the country has decreased by 10.3% to RM7,089 in 2020 from RM7,901 in 2019, says the Statistics Department.
At the same time, the median monthly household gross income also registered a decline of 11.3% as compared to 2019, dropping from RM5,873 to RM5,209.
The decline in the monthly household gross income, said Chief Statistician Datuk Seri Dr Mohd Uzir Mahidin was due to households or individuals who experienced loss or reduction of income, particularly those with the status of employee, self-employed and others.
"There are four sources of income which are paid employment, self-employment, property and investment and current transfer received.
"In 2020, paid employment and self-employment which were the main sources of income recorded a decrease of negative 16.1% and negative 9.7% respectively," he said in a statement on Friday (Aug 6).
Mohd Uzir said furthermore, this reduction of income was not only caused by job loss but by the reduction of working hours and increase in skill-related underemployment.
The statement was released as part of the department's Household Income Estimates and Incidence of Poverty Report in 2020.
The decline in income was a result of the Covid-19 pandemic last year, which saw various restrictions put into place to curb the spread of the infections.
All states in the country, said Mohd Uzir, recorded a decline in mean and median monthly household gross income, with Putrajaya registering the lowest reduction in monthly household income.
"It remained to record the highest mean and median of monthly household gross income as compared to other states with RM12,322 and RM9,743 respectively. Kelantan remained to record the lowest mean and median income at RM4,411 and RM3,010 respectively," he said.
Mohd Uzir also said that a majority of households experienced a decline in income with many households from higher-income groups shifting to lower-income groups.
"In 2020, there was an additional of 12.5% of households with income less than RM2,500.
"Meanwhile, 20% of households from the M40 group with income between RM4,850 and RM10,959 moved to the B40 group. Households in the T20 group were also affected by the Covid-19 pandemic where 12.8% of this group shifted to the M40 group."
Mohd Uzir said based on the study, the number of poor households increased to 639,800 households in 2020 as compared to 405,400 households in 2019.