Living Standards in the 2010s in France: Increase or Decline?

The average life cycle typically displays the following pattern: Primary income rises during the early decades of working life, then slows down as individuals near the end of their careers and transition into retirement. Household living standards are also affected by changes in family structure, such as the birth or departure of children. While redistributive policies help cushion these life cycle effects, they played only a marginal role in influencing average living standards between 2010 and 2019.

Across all age groups, purchasing power trends in the 2010s were less favorable than in the previous decade. Setting apart individuals aged 55–64 in 2010, whose purchasing power declined with their transition into retirement, the two cohorts with the least favorable trajectories were younger working people (aged 30–39 in 2010) and retirees (aged 65–69 in 2010). Younger working people, the least affluent group in 2010, saw their purchasing power rise by 7% over the decade. In contrast, those aged 65–69 in 2010—who were better off in terms of both income and wealth—saw their purchasing power decline by 7%. This decline was largely driven by a reduction in wealth-based income (this does not include unrealized capital gains).

Among retirees aged 65–69 in 2010 , incomes converged between the wealthiest and poorest retirees. While pensions remained stable overall, the significant decline in income from savings during the decade disproportionately affected the wealthiest retirees. For younger working individuals, inequality slightly increased when considering income quintiles. If we look at individual income trajectories, however, a different picture emerges. The purchasing power of individuals in the bottom 20% at the beginning of the decade grew by 23%, while that of the top 20% fell by 2%.