The depressing income and poverty data
There’s no good news in today’s data from the Census bureau. Unless you’re the kind of person who worries about inflation, that is: in that case you’re probably reassured that real median household income fell 3.6% between 2007 and 2008, from $52,163 to $50,303. That’s a drop of over $1,800: real money.
Naturally, the pain was concentrated in the poorer parts of the US: incomes in the South fell by 4.9% to $45,590, while incomes in the Northeast were unchanged at $54,346.
Oh, and the number of people in poverty increased by a whopping 2.5 million, to 39.8 million: 13.2% of the population, the highest poverty rate in over a decade. How poor do you need to be in order to be counted as living in poverty? Very poor:
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.
The poverty rate for children under the age of 18 is now an eye-popping 19%: basically one child in every five is living in poverty in the US. And even if a slow economic recovery is beginning to take hold, I can’t see that number declining much in the foreseeable future. Which is unconscionable, in the richest country in the world.
Update: Emily Monea and Isabel Sawhill of the Brookings Institution have a paper out which says that “the poverty rate will increase rapidly through 2011 or 2012, at which point about 14.4 percent of the country will be in poverty”, and that the number of children living in poverty could rise by 5 million, or 38%, to 18 million.
Update 2: David Leonhardt points out that real incomes fell over the course of the past decade, from $51,295 in 1998 to $50,303 in 2008:
In the four decades that the Census bureau has been tracking household income, there has never before been a full decade in which median income failed to rise. (The previous record was eight years, ending in 1986.) Other Census data suggest that it also never happened between the late 1940s and the late 1960s. So it doesn’t seem to have happened since at least the 1930s.