Do We Want A More Realistic 'average Salary' Reported In The News

[Hypognosis]

The Office for National Statistics (ONS) provides the figure which journalists then bang on about - £26,000-odd, last time I checked.

We know that the 'arithmetic mean' is a useless figure because the stats are skewed by stratospheric earners who get paid the same per year as 1000 shop-floor level employees.

The ONS uses the 'median' figure - the middle position on the salary chart which, as above, has a long, long tail towards the high salary end so surely the figure must be artificially high because employees far outnumber managers, dont they?

Have they even heard of the 'mode' value - the "most commonly occuring value"? Would it be the national minimum wage or not?

The essence of my question is would you like this last figure to be the one which the press construct their feelgood/feelbad stories around?

By the way, for convenience, let's talk about salary bands and whole thousands.

[factor-fiction]

I feel the median is the best measure- half of us earn the same or more, half earn the same or less.
The mean is , as you say, a fairly meaningless (although interesting) figure.
The mode would have to be based on bands and there would have to be wide bands or thousands of small bands.

[factor-fiction]

I have just spotted that you referred to bands of £1000 pa. There would need to be a lot of bands and I doubt there would be any £1000 band which showed a clear spike.
There is also the issue of part time and full time earnings- we could just get a headline figure for FT but so many people now work part time .
And what about people with 2 or 3 part time jobs? I'm not sure how the analyses cover these

[Hypognosis]

Hi factor

I did say whole thousands. Would that do?

It's a frequency of occurence graph so there may be big empty gaps once you get into casino-banking territory.

What I'm getting at is at what level of salary do we find the bulk of the 60+ million people living here?

[jim360]

Not a fan of the mode, really, not in this context. Probably better of with the median, since at least then you know where the bottom 50% of earners are.

[factor-fiction]

There would be no 'bulk' category if you use £1000 bands. I suspect that there would be no-one £1000 band which covered more than 10 % of employees.
What would be useful is a table/chart that shows either deciles or the upper and lower quartiles

[factor-fiction]

Regarding the median, Hypgnosis, I'm puzzled by your sentence " the middle position on the salary chart which, as above, has a long, long tail towards the high salary end so surely the figure must be artificially high because employees far outnumber managers, don't they". The median is simply what jim and I have said- half earn that figure or less, half earn that figure or more.

[Hypognosis]

Okay, gross up the part-timers to full time because it's the -rate- of pay for the job which I'm interested in.

Multiple jobs? Well, one person with three jobs means 2 people unemployed, doesn't it? One household doing quite well for itself, thank you and the other one reliant on the state. Perhaps save that for another thread?

Thing is, if you focus on household income, that just throws the standard of living divide into even sharper focus, doesn't it? Well paid professionals tend to marry one another. Unemployables marry whoever will 'accept them as they are', no?

[Hypognosis]

//half earn that figure or less, half earn that figure or more. //

Okay, name a job title in your company which gets £26,000.

[dr b]

I suppose it would be too much to ask to report mean, median, mode, provide the full frequency distribution (say in bands of 1000), and then let people make of it what they will? Or is that placing too great a demand on people's numeracy?

[dr b]

"one person with three jobs means 2 people unemployed, doesn't it?" This is the "lump of labor" fallacy.

[factor-fiction]

I earned more than that as a teacher. I used to earn triple that as a manager in business. I now do causal teaching work and because I don't work every day i earn less than £26K. There are loads of jobs that get £26K or more- where do you want us to start- qualified teacher, qualified nurse, skilled plumber/electrician, joiner, graduate trainee in professional sector, legal executive, ...

[factor-fiction]

drb- I think putting the figures in deciles would help- that way people can see whether they are in the bottom10%, bottom 20%,.... top 10%

[factor-fiction]

correction- I do casual teaching not causal teaching.

Are you doubting the £26000 figure? I am not sure of its basis- is it full time only, is it male and female, is it household or single incomes, does it include overtime and London weighting?- but I feel it's about right for the median of full time earnings across the UK.

[dr b]

^too bad... I was intrigued by "causal teaching."

[Hypognosis]

No, not doubting it. Just trying to put it into perspective. I've been out of the loop for so long that I still think of it as a middle-manager level salary.

http://www.careerbuilder.co.uk/blog/2013/02/07/6-jobs-that-pay-the-uk-average-wage/

This page acknowledges that you need to be in a reasonably skilled occupation (college/uni education level) to be at around this so-called average level.

I would also like to know how many people are made to feel miserable by being regularly reminded that they are below average? If NMW is £13175 or thereabouts, for example?

You can tell my entire value system is all wrong, can't you?

[Hypognosis]

@dr b

Have read the Wiki on Lump of Labour Fallacy, thank you.

... and I'm siding with Tom Walker, for the time being. :o)
It even looks to me like the primary premise has been inserted by its opponents, so as to turn it into a strawman argument.

The nub of it, to my mind is, do we continue to have households which lack work and all of us moan about our taxes paying their benefits or do we encourage/cajole/force employers to take them on, give them a skill and pay them a full salary, like they're human beings?

As the economists explained, a bigger labour force means higher product prices. Nobody wants that, especially not employers. So, loads of dolités it is then.

[Hypognosis]

@dr b

//I suppose it would be too much to ask to report mean, median, mode, provide the full frequency distribution (say in bands of 1000), and then let people make of it what they will? Or is that placing too great a demand on people's numeracy? //

I wouldn't like to say that it's beyond people's numeracy. Then again, I don't think I learnt the distinction between the three types until some time after school so, at one stage it would have been beyond mine.

It's not a particularly difficult concept to grasp, once explained.

Quoting all three would be "too much information" in this sound-bite age. Anyone who wants detailed stats can look up earnings figures on Wiki, at their leisure.

Again, what I'm driving at is trying to get a feel for 'average' in terms of what is the most common experience. If there are 60 million of us and 30 million earn less than 26k, with a national minimum of 13k then you only need to display 13 of the £1000 bands to see where the biggest lump lies.

Above 26k, grading structure tends to make salaries go up in ever larger leaps so the histogram would be low numbers in any given band and I acknowledge that you'd need ever widening bands to bridge the yawning gap between 26k and the multi-million city-trader levels.

In any case, people on over 26k aren't financially uncomfortable although, if anything, it must be harder to negotiate for a raise if you're already demonstrably over the median income level.