Pethokoukis

Falling incomes: The chart that shows it’s not getting better

021212census

From the U.S. Census Bureau:

1. Median household income was $50,054 in 2011, a 1.5 percent decline in real terms from 2010 . This was the second consecutive annual decline in household income.

2. Median family household income declined by 1.7 percent in real terms between 2010 and 2011 to $62,273.

3. In 2011, real median household income was 8.1 percent lower than in 2007, the year before the most recent recession, and was 8.9 percent lower than the median household income peak that occurred in 1999.

And in the above chart, the red arrows point to the Reagan Recovery and the Obama Recovery. Typically, pretty soon after a recession ends, incomes should start rising. But that still isn’t happening this time around.

Welcome to the recovery.

UPDATE: This from IHS Global Insight on today’s Census figures:

Median household income adjusted for inflation fell for a fourth consecutive year and now stands at $50,054. Some of the decline in median income can be attributed to a growing number of low-income households.

Many middle class families have moved into the lower-income quintiles creating an income distribution that is less flat; those in the middle and lower income quintiles have a diminishing share of income, while those in the upper echelons have a rising share. Thus, income inequality is increasing. …

The main culprit behind increasing poverty rates and income inequality is the high and persistent level of the unemployment rate. There is a large pool of people in the ranks of the unemployed who have seen their standard of living drop substantially. In addition, many individuals have accepted lower salaries, or part-time employment. People with the least amount of skill are impacted more by the dismal job market.

These grave figures are not very shocking as this has been the scene in the United States for some time. The lack of improvement is the worrisome bit and those that are at the bottom of the scale feel it the worse.

 

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