The latest Daymark survey reveals perception of what classes as low or middle income is very different from the reality.

1. Daymark Community Monitor
It’s all relative: what it means to be low and
middle income in Australia
June 2011

2. Daymark Community Monitor
About the Daymark Community Monitor
Daymark is a specialist public relations agency which helps clients navigate their way through tough
reputational issues.
This survey is one in a regular series of “community monitors” that looks at the community view of
emerging public issues. Emerging public issues are ones that are just appearing on the radar of
organisations, commentators, regulators or government. They are issues which have the potential
to impact the reputation of institutions held close to the heart of the Australian public.
The aim of the Daymark Community Monitor is to inform the debate around emerging community
issues so they can be discussed in a common-sense way. The research is commissioned
independently of any Daymark client. The full survey results and questions are detailed in this
report.
The first Daymark Community Monitor examined community views on sports betting in Australia.
Community attitudes: Low and middle income Australia ©Daymark Public Relations 2

3. Daymark Community Monitor
Executive summary
The question that this Daymark Community Monitor seeks to address is who in Australia thinks they
are low and middle income and how does this compare to actual low and middle income
households?
Every day Governments of all persuasions appeal to low and middle income households. Household
income is being used to describe certain sections of the public and it is not clear that this message is
being accurately received by the real low and middle income households across the country.
We have used a well-accepted definition of income status which equates low income households as
having a gross annual income of around $44,000, middle income households earning around
$85,000 and high income households earning above $173,000.
This Daymark Community Monitor surveyed 1500 people and found that:
• People over-estimate the number of households living on a low income in Australia:
respondents estimate that 46% of households – or nearly half of Australian households - are
low income, 32% middle income and 22% high income.
• Many more people consider they live in a middle income household (56%) than believe
there are middle income households in Australia (32%).
• The opposite holds for consideration of low income households: 39% of respondents
identified themselves as low income and overall thought 46% of Australia is low income.
• Combined the data shows that 95% of people think they are either a low or middle income
household and believe that 78% of households in Australia are low and middle income.
• People’s view of what constitutes low and middle incomes stretches across many income
brackets. For example, 28% of households earning above $250,000 consider themselves as
middle income, while 83% of $150,000 households consider themselves as middle income.
The problem of “talking to” low and middle income Australia becomes immediately apparent. Many
more people think they are low and middle income than is the case through a stricter demographic
or economic measure.
The reverse also holds: when the term high income is used, the vast majority of Australian
households believe it does not apply to them and, given the status ranges we have found, never will.
This has implications for how the impact of government initiatives are understood and assessed by
the community. At a higher level it has an impact on how Australians appreciate their status relative
to others. The research shows that we are better off than we generally think we are.
Community attitudes: Low and middle income Australia ©Daymark Public Relations 3

4. Daymark Community Monitor
Introduction
A consistent feature of the debate around Government policy of all persuasions is the impact that
different policies will have on low and middle income households across Australia.
Low in middle income households are variously singled out for special measures to relieve cost of
living pressures or financial impacts from new taxes or levies, or indeed to receive specific welfare
support.
The Daymark Community Monitor asks two questions:
• Who in Australia thinks they are low and middle income?; and
• How does this perception compare to the actual low and middle income households when
there are public announcements directed at such households?
We chose this topic for our second Community Monitor because income has always been an
important differentiator in who receives help from governments. What we are seeing, however, is
income being used to describe certain sections of the Australian public and it is not at all certain how
this message is being received by the community.
We look specifically at this issue from the perspective of households with a gross income of $60,000
per year and $150,000 per year. Do these households consider themselves “low income”, “middle
income” or “high income”?
About the survey
An online survey of a representative sample of 1501 respondents across all Australian States was
conducted by The Digital Edge on behalf of the Daymark Community Monitor over the period 17 - 19
May 2011. The sample was proportionally spread by State, gender and income. All data and
questions from the survey are detailed in the back of this report.
Respondents by gross household income
> $250k, 14 Not stated, 159 < $20k, 107
$150k to $250k,
64 $20k to $40k,
271
$120k to $150k,
115
$100k to $120k,
127
$40k to $60k,
253
$80k to $100k,
168 $60k to $80k,
223
Community attitudes: Low and middle income Australia ©Daymark Public Relations 4

5. Daymark Community Monitor
For the purposes of some of the analysis in this report, the “prefer not to say” income category (“not
stated” in the graph above) was omitted so that proper comparisons could be made.
The survey asked respondents:
• Whether they considered their household to be low, middle or high income;
• What gross level of annual household income they considered as being low, middle and
high;
• What proportion of households they thought were living on low and high incomes.
For the purposes of this survey we have looked at income perceptions across all the income
categories captured in the survey demographics and have also singled out two income brackets to
assist our analysis: household incomes between $120,000 and $150,000 (referred to as $150,000
income households) and household incomes of $40,000 to $60,000 (referred to as $60,000 income
households).
Who are low and middle income Australians?
There is no succinct and completely accepted definition of what constitutes a low or middle income
household. There are however some accepted notations.
One accepted benchmark – as widely used by the Australian Bureau of Statistics - is done on a decile
classification of the Australian population. Deciles place equal numbers of a population into ten
groups. The first decile contains the bottom 10%, the second decile the next 10% and so on.
By this measure, low income households are considered the 20% of households with incomes in the
second and third deciles. Middle income households are those in the fifth and sixth deciles, and high
income households as those in the ninth and tenth deciles (ABS).
A review of gross weekly cash income of households by decile (ABS Census data 2006) places low
income households with a gross annual income of around $44,000, middle income households at
$85,000 and high income households above $173,000.
Although the census data is not accurate here, we estimate from the data we have reviewed that
that there are 75% to 80% of Australian households earning under $150,000 and 40% to 45% of
households earn less than $60,000.
The prevalence of low and middle income households
Of the respondents surveyed, 39% considered themselves to be living in low income households, a
further 56% considered themselves to be living in middle income households and the remaining 5%
considered themselves to living in a high income household.
Respondents also estimated 46% of households in Australia are low income, 22% high income and
the remaining (by inference) 32% as middle income.
Community attitudes: Low and middle income Australia ©Daymark Public Relations 5

6. Daymark Community Monitor
Perceived income status (%)
60
50 56
40 46
39 Respondents view of their
30 household
32
Respondents estimate of
20
22 households (ave)
10
5
0
Low income Middle income High income
The range in which people consider themselves as low income stretches from respondents on less
that $20,000 out to the $80,000 bracket: 22% of people earning $60,000 to $80,000 considered
themselves as low income households.
The income range over which people consider themselves as middle income is also wide: 48% of
those earning between $40,000 to $60,000 consider themselves as middle income and 27% of
households earning above $250,000 consider themselves as middle income.
These figures can be compared to the decile definition of low and medium income (see Introduction)
which puts a low income household at $44,000, medium income at $85,000 and high income above
$173,000.
% people who say household is low, middle or high
income by actual income
100
90
80
70
60
50
40 % say high income
30
20 % say middle income
10
0 % say Low income
Community attitudes: Low and middle income Australia ©Daymark Public Relations 6

7. Daymark Community Monitor
A closer look at $60,000 and $150,000 income households
Two income brackets have been selected for closer consideration in this Daymark Community
Monitor: households with a gross annual income of $60,000 and households with a gross annual
income of $150,000.
In terms of their income status, 51% of $60,000 households consider themselves low income, while
34% consider themselves as middle income.
83% of $150,000 households consider themselves as middle income, and 13% consider themselves
as high income.
Even with a $90,000 difference in household income there is little difference in the perceived
breakdown of income status across Australia. Both income brackets estimate the prevalence of low
income households at around the mid-40% mark, middle income around the mid-30% mark and high
income at around 20%.
Overall though, respondents over-estimated the percentage of low income households in Australia.
Estimated % of households, overall and by two income
brackets
100%
90% 22 18 24
80%
70% 32 34
34
60%
50% High income
40% 46 48
30% 42 Middle income
20%
10% Low income
0%
Respondents $60,000 $150,000
estimate of households households
households (ave)
Household income does have an impact over people’s perceptions as to what income qualifies as
low, middle and high status.
$60,000 households underestimate where an economic or demographic definition of middle and
high income starts by $20,000 to $30,000 (that is they estimate that middle and high income status
starts at a lower level than is generally accepted).
$150,000 households are better at estimating what household income may be considered a low
income, but have a distorted view as to when high income kicks in. 16% of households with an
income of $150,000 believe $150,000 to be low income.
Community attitudes: Low and middle income Australia ©Daymark Public Relations 7

8. Daymark Community Monitor
Income status as viewed by $60,000 income households
100%
90%
80%
70%
60%
50%
40% High income
30%
20% Middle income
10%
0% Low income
Income status as viewed by $150,000 income households
100%
90%
80%
70%
60%
50%
40% High income
30%
20% Middle income
10%
Low income
0%
What does all this mean?
Even through a relatively simple survey we can see that respondents have a skewed view of what it
means to live in a low, medium or high income household.
A very significant portion (95%) of the population thinks they are low or medium income household
whereas in an economic sense this is simply not the case. The reverse also holds: when the term
high income is used, the vast majority of Australians think it does not apply to them and never will.
This has implications for how the impact of government initiatives are understood and assessed by
households.
At a higher level the survey has importance with respect to how Australians appreciate their status
relative to others. The research shows that we are better off than we tend to think we are.
Community attitudes: Low and middle income Australia ©Daymark Public Relations 8

9. Daymark Community Monitor
Questionnaire
Conducted by The Digital Edge for Daymark on 17th to 19th May 2011
1. How would you describe the income “status” of your household? (household income refers to the
combined income of you and your partners or your income if you are not married or in defacto relationship)
a) Low
b) Middle
c) High
2. What level of gross annual household income would you describe as being “low income”?
a) Less than $20,000
b) $20,000 to $39,999
c) $40,000 to $59,999
d) $60,000 to $79,999
e) $80,000 to $99,999
f) $100,000 to $119,999
g) $120,000 to $149,999
h) $150,000 to $249,999
i) $250,000 or more
3. What level of gross annual household income would you describe as being “middle income”?
a) Less than $20,000
b) $20,000 to $39,999
c) $40,000 to $59,999
d) $60,000 to $79,999
e) $80,000 to $99,999
f) $100,000 to $119,999
g) $120,000 to $149,999
h) $150,000 to $249,999
i) $250,000 or more
4. What level of gross annual household income would you describe as being “high income”?
a) Less than $20,000
b) $20,000 to $39,999
c) $40,000 to $59,999
d) $60,000 to $79,999
e) $80,000 to $99,999
f) $100,000 to $119,999
g) $120,000 to $149,999
h) $150,000 to $249,999
i) $250,000 or more
5. There are about 8.4 million households in Australia. What proportion do you think are living on low
incomes? (please enter your response as a percentage)
6. And, what proportion to you think are living on high incomes? (please enter your response as a
percentage)
Community attitudes: Low and middle income Australia ©Daymark Public Relations 9

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