The Median U.S. Household’s Income Rises to Above $61,000 Annually
A positive note for the American economy. According to a report released by the U.S. Census on Wednesday last week, middle-class income has risen to its highest levels since 2017.
Additionally, the national poverty rate recorded a massive decline as the rippling effects of a strong economy trickled down to turn the fortunes of millions of Americans.
As a matter of fact, the median American household recorded earnings of $61,372, which means that about half of all families brought in this income, with half earning less.
So What Does This Mean?
The fact that half of the American middle-class has surpassed the $61,000 means that families could be earning much more than they did in 1999.
However, the Census Bureau has noted that despite the median income rising, it does not mean that it could be statistically higher than that of 1999, or even 20007, a year before the economic recession took place.
That’s because of the change in methodology that was implemented in 2013 making these comparisons much more difficult to execute.
Additionally, there is also the issue of inflation, whereby the recently released figures have been adjusted to mirror the 2017 dollars.
Americans Getting Jobs Again
However, one cannot deny that middle-class household income has been on the steady rise for the past couple of years, ever since the economy bounced back from the massive 2008 recession. As Americans begin getting jobs again, households are receiving extra income from having new individuals in the home employed once more.
Moreover, the fact that these individuals are working additional hours is boosting household income more than ever. This is according to a statement released by the Census Bureau.
According to assistant division chief at Census Bureau, Trudi Renwick, the fact that individuals are moving from part-time work to full-time work could be one of the reasons why this increase in income is taking place.
Lowest Poverty Rate in a Decade
Additionally, the U.S. Census Bureau further reported that the decline in poverty rate by 12.3 percent is the largest that the country has experienced in over a decade. This could also be playing a major part, and a clear indicator that the effects of the Great Recession are now fading away.
However, the economy has not been as kind to everyone. Inequality is still at its highest levels, and as per data released by the Census Bureau, the number of Americans still living without health insurance still remained the same despite several measures that have been put in place to extend coverage to more people as per the Affordable Care Act.
The number of Americans without health insurance remained the same at 28.5 million people, or 8.8%, despite the economic boom that the country is currently experiencing.
Hourly Wages Still the Same
According to the former chief economist to ex VP Joe Biden, what will make Americans move forward is them to receive higher hourly wages.
That being said, a high portion of income growth that has been experienced has been a result of people getting jobs once more.
However, economists across the political divide have agreed that the growth in wages has been quite disappointing and that the situation would be better in terms of productivity if wages were increased.
According to the Head of the American Action Forum, Douglas Holtz-Eakin, the income that’s been generated has resulted from individuals going back to work after the recession, and not from any growth in wages.
The Same Number of Americans Still Poor
As a matter of fact, the Census Bureau unveiled that income from full-time works recorded a slight decrease last year, showcasing the fact that wage growth has remained sluggish due to effects such as a rising cost in necessities, rent, and price gases.
However, it is worth mentioning that this data was released by the Bureau prior to President Trump and GOP leaders scaling back regulations and approving tax cuts in a bit to improve wages, productivity, and economic growth.
On the other hand, Democrats have countered, claiming that the tax cuts were mainly put in place to favor America’s wealthy society.
As a matter of fact, records show that over 39.7 million Americans are currently living in poverty, a number that has remained relatively the same from 2016. This is the case despite the fact that the poverty rate is currently at its lowest since 2006.
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