According to simulations conducted using the Ines model, the mean earned income per household in constant euros may be 1.2% lower in 2016 than in 2008. The socio-fiscal reforms targeting the structural recovery of public finances following the economic crisis, the rise in unemployment and part-time work and demographic changes are possible factors explaining such a reduction. Demographic changes (increase in the proportion of retired households in line with population ageing and of single-parent and single-person households) contributed to a 1.1% decrease in mean household income. Without these demographic changes, the mean earned income per household would therefore have fallen by 0.1%. This 0.1% decrease can be broken down into an effect of changes in the labour market, an effect of the new socio-fiscal measures and a residual effect.

Over the 2008-2016 period, changes in unemployment levels and in part-time work had no effect on mean purchasing power in terms of earned income per household, but did have differentiated effects according to where households are situated in respect of the distribution of living standards. It is those households with a standard of living lower than the median that have suffered the effects of the deterioration of the labour market.

Without the socio-fiscal reforms undertaken between 2008 and 2016, the mean earned income of households may have been 1.4% higher in 2016. The effects of these reforms differ according to where households are situated in respect of the distribution of living standards. The highest-earning households were taxed the most heavily: the top 5% of the distribution saw their annual earned income fall by 5,640 euros under the effect of the new tax measures (increase in social insurance contributions, creation of an income tax bracket at 45%, taxation of income on capital on the basis of the income tax scale, etc.). The lowest-earning households benefited from the social policy and safety nets: the lowest-earning 5% saw their annual earned income increase by more than 450 euros and the second lowest-earning 5% saw it increase by 890 euros as a result of the benefit reforms (revaluation of the minimum social benefits, creation of the employment bonus, etc.).

Together, the amendments to socio-fiscal legislation, deterioration of the labour market and demographic changes may have contributed to reducing the mean earned income per household by 2.4%. At the same time, other factors, not taken into account in our analysis, may have increased the earned income of households by 1.2%, given that ultimately it may have contracted by only 1.2% over the study period.