American household is earning less than four years ago when Recession ended

The average American household is earning less than when the Great Recession ended four years ago, according to a report released Wednesday.

U.S. median household income, once adjusted for inflation, has fallen 4.4 percent in that time, according to the report from Sentier Research. The report is based on an analysis of Census Bureau data.

The median, or midpoint, income in June 2013 was $52,098. That's down from $54,478 in June 2009, when the recession officially ended. And it's below the $55,480 that the median household took in when the recession began in December 2007.

The report says nearly every group is worse off than four years ago, except for those 65 to 74. Some groups have experienced larger-than-average declines, including blacks, young and upper-middle-aged people, and the unemployed. Read more >>

Incomes Continuing to Decline

Noel Sheppard
One of the negative features of the current economic recovery has been declining incomes of average Americans. This trend continued in October.

The Labor Department reported Friday that despite 171,000 jobs being added to nonfarm payrolls in October, average hourly earnings for such employees edged down by 1 cent to $23.58. Average hourly earnings of private-sector production and nonsupervisory employees also dropped by 1 cent to $19.79.

This continues a trend reported by the Census Bureau in August finding that since the recovery began in June 2009, median household incomes have fallen 4.8 percent adjusted for inflation.

Also of note, the manufacturing workweek edged down by 0.1 hour to 40.5 hours. The average
workweek for production and nonsupervisory employees on private nonfarm payrolls also edged
down by 0.1 hour to 33.6 hours.

As such, despite the positive headline numbers in this report, this is by no means a strong jobs market this far into an economic recovery.

Household Incomes Fall Over 8%

In another sign that the economic recovery under President Obama is not producing gains for average Americans, median household incomes fell 1.1% in August to $50,678, according to a report released Tuesday by Sentier Research. Since the economic recovery started in June 2009, household incomes are down 5.7%, the Sentier data show, and they are down more than 8% since Obama took office.

"Even though we are technically in an economic recovery, real median annual household income is having a difficult time maintaining its present level, much less recovering," said Sentier co-founder and former Census Bureau official Gordon Green.

Earlier this month, the Census Bureau released its annual report showing that the number of people in poverty was nearly 3 million higher in 2011 than in 2009, an increase of 6%. That report also found that average incomes for middle- and lower-income households fell in 2011 after adjusting for inflation. They rose only for the wealthiest 20% of households. Read more >>

Median Income Worse Now Than It Was During Great Recession

A new report put out by the Pew Research Center finds that the median income is worse now than it was during the Great Recession.

According to Pew, the Census Bureau showed that the median income for American households in 2009 – the official end of the Great Recession – was $52,195 (in 2011 dollars), while the median income dipped to $50,054 last year, falling 4.1 percent over two years.

“The decrease in household income from 2009 to 2011 almost exactly equaled the decrease in income in the two years of the recession,” the Pew report stated. “During the Great Recession, the median U.S. household income (in 2011 dollars) dropped from $54,489 in 2007 to $52,195 in 2009, a loss of 4.2 percent. By this yardstick, the recovery from the Great Recession is bypassing the nation’s households.” Read more >>

Incomes still well below pre-recession levels

Median household incomes, before taxes and adjusted for inflation, have risen 2.2% in the last year through June, according to Sentier Research, a consulting firm founded by Census Bureau researchers. They remain 7.2% below where they were in December 2007 — the start of the recession — and 4.8% below when the recession ended in June 2009, Sentier reported.

The recent improvement was concentrated in late 2011, but the median has slipped slightly this year, in part because of inflation, Sentier partner Gordon Green said. "Inflation is a big player now" in future household budgets, Green said. "Incomes have flattened out, and gas prices are going up again."

Consumers have lost more ground since the recession ended than they did while it was still occurring, the report said, repeating a conclusion Sentier published last year. The damage has been much worse, predictably, in homes where the person listed as the property owner or renter has been unemployed. Their incomes are down 22.6% since June 2009. But even households where the primary earner has been employed continuously also have incomes almost 5% lower than in June 2009. Read more>>

Study: Middle-class poorer, earn less

For the first time since at least World War II, middle-class families finished the first decade of the 21st century poorer and with lower incomes than they had 10 years earlier. And 85% of those surveyed say that in the 2000s, it was harder than before to maintain a middle-class lifestyle, according to a study out Wednesday by the Pew Research Center for Social and Demographic Trends.

Median household income dropped nearly $3,500 for a three-person household, to $69,487 a year, the Pew study said. The median household's net worth dropped 28% to $93,150. Incomes have dropped since 2000, while wealth rose modestly early in the decade before gains were wiped out by the recession that began in 2007 recession and the financial crisis sparked in 2008, said Paul Taylor, a Pew executive vice president.

"That the middle class always enjoys a rising standard of living is part of America's sense of itself, and it has always been true - until now," Taylor said in an interview, describing the 2000s as a "lost decade" for the middle class. "It's been 11 years since the peak in household incomes, and that covers the early part of the decade as well." Read more >>

More Americans 'double up' in tough economy

There's been talk of people sharing homes during the recession, and now the Census Bureau has released the data to prove it.

This spring, there were 21.8 million "doubled-up" households across the nation, a 10.7 percent increase from the 19.7 million households in the spring of 2007, the Census Bureau said. That means 18.3 percent of all households were combined households.

Much of the increase was the result of adult children who either moved back home during the recession or never left. Among adults between the ages of 25 and 34, some 5.9 million were living with their parents this spring, up from 4.7 million before the recession hit in 2007. That 25 percent increase translated to 14.2 percent of all young adults living with their parents in March, the bureau said. More...

Many age groups poorer than they were 40 years ago

Image by Marc :"" En el Pais de los sueños..."" via Flickr

Dennis Cauchon, USA TODAY

The incomes of the young and middle-aged — especially men — have fallen off a cliff since 2000, leaving many age groups poorer than they were even in the 1970s, a USA TODAY analysis of new Census data found. People 54 or younger are losing ground financially at an unprecedented rate in this recession, widening a gap between young and old that had been expanding for years.

While the young have lost ground, older people have grown more prosperous over the years and the decades. Older women have done best of all.

The dividing line between those getting richer or poorer: the year 1955. If you were born before that, you're part of a generation enjoying a four-decade run of historic income growth. Every generation after that is now sinking economically.

Household income for people in their peak earning years — between ages 45 and 54 — plunged $7,700 to $64,349 from 2000 through 2008, after adjusting for inflation. People in their 20s and 30s suffered similar drops. Older people enjoyed all the gains.

The line between the haves and have-nots runs through the middle of the Baby Boom, the population explosion 1946-64.

"The second half of the Baby Boom may be in the worst shape of all," says demographer Cheryl Russell of New Strategist Publications, a research firm. "They're loaded with expenses for housing, cars and kids, but they will never generate the income that their parents enjoyed."

US Census Bureau: 40 Million Live in Poverty

Image by Getty Images via Daylife

According to a Thursday US Census Bureau report, nearly 40 million people lived in poverty in the United States last year as the recession forced the first significant rise in the US poverty rate in five years. The official poverty rate in 2008 was 13.2 percent, up from 12.5 percent in 2007, according to the Census Bureau's annual "Income, Poverty, and Health Insurance Coverage
in the United States" report.

The rise marked the first time since 2004, when the poverty rate climbed from 12.5 percent to 12.7 percent, that the percentage measure of US poor rose significantly, said David Johnson, head of the Housing and Household Economic Statistics Division at the Census Bureau.

From the report:

The U.S. Census Bureau announced today that real median household income in the United States fell 3.6 percent between 2007 and 2008, from $52,163 to $50,303. This breaks a string of three years of annual income increases and coincides with the recession that started in December 2007.

The nation’s official poverty rate in 2008 was 13.2 percent, up from 12.5 percent in 2007. There were 39.8 million people in poverty in 2008, up from 37.3 million in 2007.

Meanwhile, the number of people without health insurance coverage rose from 45.7 million in 2007 to 46.3 million in 2008, while the percentage remained unchanged at 15.4 percent.

These findings are contained in the report Income, Poverty, and Health Insurance Coverage in the United States: 2008. The following results for the nation were compiled from information collected in the 2009 Current Population Survey (CPS) Annual Social and Economic Supplement (ASEC):

Income

Race and Hispanic Origin (Race data refer to people reporting a single race only. Hispanics can be of any race.)

• Between 2007 and 2008, the real median income of non-Hispanic white households declined 2.6 percent (to $55,530); for blacks, it declined 2.8 percent (to $34,218); for Asians, it declined 4.4 percent (to $65,637); and for Hispanics, it declined 5.6 percent (to $37,913). Except for the difference between the declines for non-Hispanic white and Hispanic households, all other differences between the declines were not statistically significant.

Regions

• Between 2007 and 2008, real median household income declined in the South by 4.9 percent (to $45,590), declined in the Midwest by 4.0 percent (to $50,112) and declined in the West by 2.0 percent (to $55,085). Income in the Northeast was statistically unchanged ($54,346). The apparent differences in the declines in median household income between the South and Midwest, and the Midwest and West were not statistically significant. The apparent difference between the median household incomes for the West and Northeast was not statistically significant.

Poverty

Overview

• The increase in the poverty rate between 2007 and 2008 was the first statistically significant annual increase since 2004. The 2008 poverty rate (13.2 percent) was the highest since 1997.
• In 2008, the family poverty rate and the number of families in poverty were 10.3 percent and 8.1 million, respectively, up from 9.8 percent and 7.6 million in 2007.
• For married-couple families, both the poverty rate and the number in poverty increased — 5.5 percent (3.3 million) in 2008, up from 4.9 percent (2.8 million) in 2007. Both measures, however, showed no statistical change in 2008 for female-householder-with-no-husband-present families (28.7 percent and 4.2 million) and for male-householder-no wife-present families (13.8 percent and 723,000).

Thresholds

• As defined by the Office of Management and Budget and updated for inflation using the Consumer Price Index, the weighted average poverty threshold for a family of four in 2008 was $22,025; for a family of three, $17,163; for a family of two, $14,051; and for unrelated individuals, $10,991.

Race and Hispanic Origin (Race data refer to people reporting a single race only. Hispanics can be of any race.)

• In 2008, the poverty rate increased for non-Hispanic whites (8.6 percent in 2008, up from 8.2 percent in 2007), Asians (11.8 percent in 2008, up from 10.2 percent in 2007) and Hispanics (23.2 percent in 2008, up from 21.5 percent in 2007). The poverty rate in 2008 was statistically unchanged for blacks (24.7 percent).

Age

• The poverty rate increased for children younger than 18 (19.0 percent in 2008, up from 18.0 percent in 2007) and people 18 to 64 (11.7 percent in 2008, up from 10.9 percent in 2007), while it remained statistically unchanged for people 65 and older (9.7 percent).
• Similar to the patterns observed for the poverty rate in 2008, the number of people in poverty increased for children younger than 18 (14.1 million in 2008, up from 13.3 million in 2007) and people 18 to 64 (22.1 million in 2008, up from 20.4 million in 2007) but remained statistically unchanged for seniors 65 and older (3.7 million).