Quarterly Sector Accounts - 4th quarter of 2015

Household real income in 2015: the fastest growing for the last 8 years

31.03.2016
Code: 050057-15
 

Household real income increased by 3.5% in 2015, which was the fastest growth since 2007. Household real consumption per capita increased even faster, year-on-year, namely by 4.0%.


Non-financial corporations: profitability in the Q4 stable, year-on-year

Profit rate1 in the fourth quarter of 2015 was 49.3%, which is by 0.2 p.p. less, y-o-y. The profitability of corporations slightly decreased due mainly to extraordinary events in the chemical and power industries. Investment rate2 decreased by 1.8 p.p., y‑o-y, and reached 28.9%.


Households: real income in the Q4 increased by 4.8%

Household real income per capita3 increased by 4.8%, year-on-year. Household real consumption per capita4 grew with a higher growth rate, i.e. by 5.6%.

Average monthly income of households per capita in nominal terms5 was CZK 24 299; of that, CZK 4 791 consisted of individual services and goods6 provided by the general government and non-profit institutions serving households.

Average monthly income from employment7 reached CZK 28 347 in the Q4 and it increased in real terms by 2.9%, y-o-y.

Average monthly consumption of households per capita in nominal terms8 reached CZK 22 095.

The faster growth of household expenditure than household income resulted in a lower saving rate9 compared to the previous year, namely 12.9%. Also investment rate in the household sector slightly decreased to 8.6%, year-on-year.


Non-financial corporations in 2015: profitability increased

Profit rate1 increased to 49.7% in 2015, which is by 0.4 p.p. more, year-on-year. Investment rate2 decreased by 0.5 p.p. compared to 2014 and reached 28.2%.

Profit rate and investment rate of non-financial corporations (%)

 

Q1

Q2

Q3

Q4

Year 2015

Profit rate

49.4

50.0

50.0

49.3

49.7

Investment rate

27.0

27.9

28.9

28.9

28.2


Households in 2015: real income increased by 3.5%

Household real income per capita3 increased by 3.5% compared to 2014. Household real consumption per capita4 grew by 0.5 p.p. faster growth rate, i.e. by 4.0%.

Household real income and expenditure, year-on-year change (%)

 

Q1

Q2

Q3

Q4

Year 2015

Real income

2.6

3.3

3.0

4.8

3.5

Real consumption (expenditure)

 3.3

 3.2

 3.6

 5.6

 4.0

Average monthly income of households per capita in nominal terms5 was CZK 22 231, of that CZK 3 937 consisted of individual services and goods6 provided by the general government and non-profit institutions serving households.

Average monthly income from employment7 reached CZK 26 787 in 2015 and it increased in real terms by 2.6%, compared to 2014.

Average monthly consumption of households per capita in nominal terms8 reached CZK 20 553.

Saving rate9 reached 10.5% in 2015, i.e. by 0.5 p.p. less than in 2014. On the contrary, investment rate in the household sector slightly increased to 7.9%, which is by 0.1 p.p. more, y-o-y.


Relationship to the rest of the world in 2015: profit from foreign investment10 exceeded CZK 440 bn.

A record outflow of income to abroad (by almost CZK 40 bn more than in 2014) was related to high profitability of foreign direct investment in the Czech Republic. A larger part of those financial sources was left in the CR, for the time being, in the form of reinvested earnings. These sources, however, are in the ownership of the rest of the world (non-residents) and can be drawn in the periods to come.  

On the contrary, outflow of income from profit was partially compensated by inflow of income from abroad, especially by interest and income from employment. A negative balance of primary income from abroad was historically the highest and reached CZK 343 bn.

Gross national income in real terms increased by 4.7% in 2015 having thus higher growth rate than the gross domestic product.

Gross disposable income for the entire economy in real terms grew in 2015 even faster, namely by 4.8%.

 

At the same time, the estimate of the gross domestic product (GDP) has been refined because of new data for the general government sector. The refinement had no impact on the GDP growth rate. For the time series of GDP resources and uses see: https://www.czso.cz/csu/czso/hdp_ts.

 

Notes:
1.   The profit rate of non-financial corporations is defined as the gross operating surplus divided by the gross value added (B.2g/B.1g). The indicator refers to profitability of production factors from the production process.
2.   The investment rate of non-financial corporations is defined as the gross fixed capital formation divided by the gross value added (P.51g/B.1g). The indicator refers to the investments in non-financial assets (buildings, machinery etc.) divided by the value created during the production process.
3.   Household real income per capita is defined as the adjusted gross disposable income of households, in nominal terms, divided by the mid-year population and deflated by the deflator (price index) of household final consumption expenditure.
4.   Household real consumption per capita is defined as real household final consumption, in nominal terms, divided by the mid-year population and deflated by the deflator (price index) of household final consumption expenditure.
5.   Average monthly income of households per capita, in nominal terms, is defined as the adjusted disposable income of households divided by the mid-year population.
6.   Individual services and goods provided to households by the general government and non-profit institutions serving households (NPISHs) refer to the value of products and services provided in the form of health and social care, education, housing, and the like. They include especially benefits in kind related to health insurance (payments for health aids,  medical and dental treatment, medical operations, and the like) paid by health insurance companies to providers of such goods and services. Social transfers in kind (D.63) further include benefits in kind provided by municipalities (including reimbursements for approved household expenditure for certain types of products and services) and all the value of non-market services of the general government and non-profit institutions serving households provided for individual consumption. The same value is imputed in the sector of households on the income side (adjusted disposable income) as well as on the expenditure side (real final consumption of households).
7.   Average monthly income from employment is defined as wages and salaries for the national economy (D.11) in average per month divided by the number of employees (full-time equivalent). The wages and salaries indicator includes all income from employment, namely in cash as well as in kind (employee benefits) regardless of whether they have been officially reported or not. The number of employees (full-time equivalent) includes all forms of employment, formal and informal. Various types of agreements are also included. The calculation does not include hours worked by working owners of enterprises, who are according to national accounts definitions included in the category of employees.
8.   Average monthly consumption of households per capita, in nominal terms, is defined as the real household final consumption divided by the mid-year population.
9.   Household saving rate is defined as the gross savings divided by the gross disposable income with inclusion of adjustment for net share of households in reserves of pension funds. (B.8g/(B.6g+D.8)). Gross savings are part of gross disposable income, which has not been consumed in the form of final consumption expenditure.
10. Profit from foreign investment consists of paid dividends and reinvested earnings. Dividends are related to the economic result of the previous period and thus the reinvested earnings are a supplement to the economic result of current period and can reach also negative values. These two components in total are the profit belonging to foreign owners.

 

Contact person: Vladimír Kermiet, Director of the National Accounts Department
phone number (+420) 274 054 247, e-mail: vladimir.kermiet@czso.cz
Used data sources updated as at: 18 March 2016
Related CZSO website: https://www.czso.cz/csu/czso/quarterly-national-accounts-gdp-resources-and-uses-and-gdp-preliminary-estimate
Next Release will be published on: 1 July 2016 (Quarterly Sector Accounts for the first quarter of 2016)

Data of quarterly sector accounts are not seasonally adjusted and therefore cannot be compared quarter-on-quarter.

The news release of Eurostat on quarterly sector accounts is published later. The latest published information for the third quarter of 2015 is available at:
http://ec.europa.eu/eurostat/web/products-press-releases/-/2-14012016-AP,
http://ec.europa.eu/eurostat/web/products-press-releases/-/2-14012016-BP,
http://ec.europa.eu/eurostat/web/products-press-releases/-/2-28012016-AP.

Quarterly sector accounts data are published on the CZSO website in the tables of Transactions in Products and Distributive Transactions by Sector: http://apl.czso.cz/pll/rocenka/rocenkavyber.kvart_qsa?mylang=EN
and Quarterly Non-financial Sector Accounts (Current and Capital Accounts): 
http://apl.czso.cz/pll/rocenka/rocenkavyber.kvart_qsa_mat?mylang=EN

 

  •      acsu033116.doc

  • Annexes:
  • Table 1 Selected indicators of Quarterly Sector Accounts (seasonally not-adjusted data)
  • Table 2 Selected indicators of Quarterly Sector Accounts - y-o-y (seasonally not-adjusted data)
  • Graph 1 Average monthly income of households from employment per employee development, not seasonally adjusted
  • Graph 2 Real income and household consumption per capita development, not seasonally adjusted
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Published: 31.03.2016
The data are valid as of the release date of the publication.


Contact: Information Services Unit - Headquarters, tel.: +420 274 056 789, email: infoservis@czso.cz