Yesterday the Census Bureau announced that real median income in the United States had reached its highest point ever:
SEPT. 12, 2017 — The U.S. Census Bureau announced today that real median household income increased by 3.2 percent between 2015 and 2016, while the official poverty rate decreased 0.8 percentage points. At the same time, the percentage of people without health insurance coverage decreased.
Median household income in the United States in 2016 was $59,039, an increase in real terms of 3.2 percent from the 2015 median income of $57,230. This is the second consecutive annual increase in median household income.
The nation’s official poverty rate in 2016 was 12.7 percent, with 40.6 million people in poverty, 2.5 million fewer than in 2015. The 0.8 percentage point decrease from 2015 to 2016 represents the second consecutive annual decline in poverty. The 2016 poverty rate is not statistically different from the 2007 rate (12.5 percent), the year before the most recent recession.
That’s the good news.
The bad news is that we are presently in the eighth year of an economic expansion and it has taken that entire time for incomes to recover. That is very slow income growth.
The ugly is that the changes in real income vary sharply by race/ethnicity. Incomes for “Asians”, an extremely peculiar census classification since it clumps together people with tremendously varying profiles, have risen sharply. Incomes for Hispanics have risen somewhat. Incomes for whites (another peculiar classification for similar reasons) are a very small tick higher than the previous high back in 2000. The real median income of blacks is just what it was 17 years ago and lower than that for Asians, whites, or Hispanics.
Here’s a handy FED chart that’s enlightening.
That chart exactly matches my income! Amazing.
I mean the bottom one.
Unfortunately the increase appears due to Americans working more hours, not rising real wages.