Household income crept higher and the poverty rate edged lower last year, the government said Tuesday, while the number of Americans without health insurance rose by 2.2 million to 47 million people.
Median household income rose 0.7 percent to $48,200, adjusted for inflation, the Census Bureau reported. But more people had to be at work in each household to get there.
That's because median earnings for individuals working full-time year-round actually fell for the third consecutive year. For men, earnings slipped 1.1 percent to a median of $42,300, while for women, earnings sank 1.2 percent to a median of $32,500.
Whites,. who earn more than blacks and Hispanics, are a dwindling portion of the US population. So this stagnation in median income isn't too surprising.
The sorta good times sure didn't last long. Wages have declined since a February 2007 peak.
The slight improvements in household income and a drop in the poverty rate came during a period of job growth, particularly toward the end of 2006, and declining inflation as a result of falling oil prices. But in 2007, the economy has begun weakening because of the national housing slump, and inflation has jumped. The average wage peaked at $17.52 an hour in February and has since fallen, according to Labor Department data.
The cost of oil is biting. I expect that bite to get worse.
More than half of all household income was earned by the wealthiest 20% of the population, with incomes above $97,000. Only 3.4% was earned by the bottom fifth, with incomes below $20,000. The median household income remained 2.1% below its pre-recession peak in 1999.
So we had a big economic recovery and now we've reached the end of the and I hear Peggy Lee singing "Is that all there is?".
The median household income last year was still about $1,000 less than in 2000, before the onset of the last recession. In 2006, 36.5 million Americans were living in poverty ó 5 million more than six years before, when the poverty rate fell to 11.3 percent.
And what is perhaps most disturbing is that it appears this is as good as itís going to get.
Sputtering under the weight of the credit crisis and the associated drop in the housing market, the economic expansion that started in 2001 looks like it might enter history books with the dubious distinction of being the only sustained expansion on record in which the incomes of typical American households never reached the peak of the previous cycle.
The bureau's poverty rate measures a snapshot in time. Some experts say that focus masks a significant increase in economic instability for Americans that makes more people in the middle class vulnerable to poverty. That's because while the percentage of people in poverty at a given time may be declining (it's fluctuated between 10 and 15 percent for the past 20 years), more Americans overall are experiencing poverty at some time during their lives than at any time during the past 30 years, according to a study done at Washington University in St. Louis.
The study found that in the 1970s, about 24 percent of people between the ages of 20 and 29 experienced poverty for a year or more. In the 1980s, that went up to 30 percent. And in the 1990s, it increased to 38 percent. The reasons, according to Mark Rank, one author of the study, are the increase in lower-paying jobs, employment insecurity, and significant decreases in health-insurance coverage.
It says something about the amount of money that gets sucked in by the federal government that Maryland has bypassed New Jersey for the highest median income of any state. Do I even need to tell you that Mississippi is at the bottom?
|Share |||By Randall Parker at 2007 August 28 11:33 PM Economics Family|