Household income in the United States

Last updated

U.S. real median household income reached $61,372 in 2017, an increase of $1,063 or 1.8% vs. 2016. It increased 3.1% in 2016 and 5.1% in 2015. US Real Household Median Income thru 2014.png
U.S. real median household income reached $61,372 in 2017, an increase of $1,063 or 1.8% vs. 2016. It increased 3.1% in 2016 and 5.1% in 2015.
Map of states by median household income in 2015. Darker blue indicates higher income; the detail is included in the image page. United States Map of Median Household Income by State (2015).svg
Map of states by median household income in 2015. Darker blue indicates higher income; the detail is included in the image page.
The middle class shrinkage Middle class shrinkage.png
The middle class shrinkage

Household income is an economic measure that can be applied to one household, or aggregated across a large group such as a county, city, or the whole country. It is commonly used by the United States government and private institutions to describe a household's economic status or to track economic trends in the US.

Contents

One key measure is the real median level, meaning half of households have income above that level and half below, adjusted for inflation. According to the Census, this measure was $61,372 in 2017, an increase of $1,063 or 1.8% versus 2016, the second consecutive record level year. This measure was $60,309 in 2016 (up $1,833 or 3.1% vs. 2015) and $58,476 in 2015 (up $2,863 or 5.1% vs. 2014). [2]

The distribution of U.S. household income has become more unequal since around 1980, with the income share received by the top 1% trending upward from around 10% or less over the 1953–1981 period to over 20% by 2007. [3] After falling somewhat due to the Great Recession in 2008 and 2009, inequality rose again during the economic recovery, a typical pattern historically. [4] [5]

Income inequality in the United States National income inequality

Income inequality in the United States is the extent to which income is distributed in an uneven manner among the American population. The inequality has increased significantly since the 1970s after several decades of stability, meaning the share of the nation's income received by higher income households has increased. This trend is evident with income measured both before taxes as well as after taxes and transfer payments, but diminishes to a significant extent if in-kind compensation is considered, such as employer-paid healthcare premiums, which have increased dramatically over the same time period. Income inequality has fluctuated considerably since measurements began around 1915, moving in an arc between peaks in the 1920s and 2000s, with a 30-year period of relatively lower inequality between 1950–1980. Recasting the 2012 income using the 1979 income distribution, the bottom 99% of families would have averaged about $7,100 more income.

Great Recession Early 21st-century global economic decline

The Great Recession was a period of general economic decline observed in world markets during the late 2000s and early 2010s. The scale and timing of the recession varied from country to country. The International Monetary Fund (IMF) has concluded that it had the most severe economic and financial meltdown ever since the Great Depression and it is frequently seen as the second worst downturn of all time.

Economic recovery

An economic recovery is the phase of the business cycle following a recession, during which an economy regains and exceeds peak employment and output levels achieved prior to downturn. A recovery period is typically characterized by abnormally high levels of growth in real gross domestic product, employment, corporate profits, and other indicators.

Definition

A household's income can be calculated in various ways but the US Census as of 2009 measured it in the following manner: the income of every resident of that house that is over the age of 15, including wages and salaries, as well as any kind of governmental entitlement such as unemployment insurance, disability payments or child support payments received, along with any personal business, investment, or other recurring sources of income. [6]

In family law and public policy, child support is an ongoing, periodic payment made by a parent for the financial benefit of a child following the end of a marriage or other relationship. Child maintenance is paid directly or indirectly by an obligor to an obligee for the care and support of children of a relationship that has been terminated, or in some cases never existed. Often the obligor is a non-custodial parent. The obligee is typically a custodial parent, a caregiver, a guardian, or the state.

The residents of the household do not have to be related to the head of the household for their earnings to be considered part of the household's income. [7] As households tend to share a similar economic context, the use of household income remains among the most widely accepted measures of income. That the size of a household is not commonly taken into account in such measures may distort any analysis of fluctuations within or among the household income categories, and may render direct comparisons between quintiles difficult or even impossible. [8] The US Census does not include noncash benefits such as health benefits. [9]

U.S. economic growth is not translating into higher median family incomes. Real GDP per household has typically increased since the year 2000, while real median income per household was below 1999 levels until 2016, indicating a trend of greater income inequality. US GDP per capita vs median household income.png
U.S. economic growth is not translating into higher median family incomes. Real GDP per household has typically increased since the year 2000, while real median income per household was below 1999 levels until 2016, indicating a trend of greater income inequality.
Total compensation's share of GDP has declined by 4.5 percentage points from 1970 to 2016. This implies that the share attributed to capital increased in that period. U.S. Compensation as Percent of GDP - v1.png
Total compensation's share of GDP has declined by 4.5 percentage points from 1970 to 2016. This implies that the share attributed to capital increased in that period.
U.S. real wages (i.e. production) for ordinary (i.e. non-supervisory) workers remain slightly below their 1970s peak. U.S. Hourly Wages - Real or Adjusted for Inflation 1964-2014.png
U.S. real wages (i.e. production) for ordinary (i.e. non-supervisory) workers remain slightly below their 1970s peak.

The U.S. Census Bureau reported in September 2017 that real median household income was $59,039 in 2016, exceeding any previous year. This was the fourth consecutive year with a statistically significant increase by their measure. [12]

Changes in median income reflect several trends: the aging of the population, changing patterns in work and schooling, and the evolving makeup of the American family, as well as long- and short-term trends in the economy itself. For instance, the retirement of the Baby Boom generation should push down overall median income, as more persons enter lower-income retirement. However, analysis of different working age groups indicate a similar pattern of stagnating median income as well. [13]

Journalist Annie Lowrey wrote in September 2014: "The root causes [of wage stagnation] include technological change, the decline of labor unions, and globalization, economists think, though they disagree sharply on how much to weight each factor. But foreign-produced goods became sharply cheaper, meaning imports climbed and production moved overseas. And computers took over for humans in many manufacturing, clerical, and administrative tasks, eroding middle-class jobs growth and suppressing wages." [14]

Another line of analysis, known as "total compensation," presents a more complete picture of real wages. The Kaiser Family Foundation conducted a study in 2013 which shows that employer contributions to employee healthcare costs went up 78% from 2003 to 2013. [15] The marketplace has made a trade-off: expanding benefits packages vs. increasing wages.

Measured relative to GDP, total compensation and its component wages and salaries have been declining since 1970. This indicates a shift in income from labor (persons who derive income from hourly wages and salaries) to capital (persons who derive income via ownership of businesses, land and assets). This trend is common across the developed world, due in part to globalization. [16] Wages and salaries have fallen from approximately 51% GDP in 1970 to 43% GDP in 2013. Total compensation has fallen from approximately 58% GDP in 1970 to 53% GDP in 2013. [17]

However, as indicated by the charts below, household income has still increased significantly since the late 1970s and early 80s in real terms, partly due to higher individual median wages, and partly due to increased opportunities for women.

According to the CBO, between 1979 and 2011, gross median household income, adjusted for inflation, rose from $59,400 to $75,200, or 26.5%. [18] However, once adjusted for household size and looking at taxes from an after-tax perspective, real median household income grew 46%, representing significant growth. [19]

The following table summarizes real median household income at key recent milestones:

Variable1999 Previous Record2007 Pre-Crisis Peak2012 Post-Crisis Trough2016 Previous Record2017 Record2018
Real median household income [20] $60,062$59,534$54,569$60,309$61,372Avail. Sept '19

Uses

Use of individual household income: The government and organizations may look at one particular household's income to decide if a person is eligible for certain programs, such as nutrition assistance [21] or need-based financial aid, [22] among many others.

Use at the aggregate level: Summaries of household incomes across groups of people - often the entire country - are also studied as part of economic trends like standard of living and distribution of income and wealth. Household income as an economic measure can be represented as a median, a mean, a distribution, and other ways. Household income can be studied across time, region, education level, race/ethnicity, and many other dimensions. As an indicator of economic trends, it may be studied along with related economic measures such as disposable income, debt, household net worth (which includes debt and investments, durable goods like cars and houses), wealth, and employment statistics.

Median inflation-adjusted ("real") household income

Median inflation-adjusted ("real") household income generally increases and decreases with the business cycle, declining in each year during the periods 1979 through 1983, 1990 through 1993, 2000 through 2004 and 2008 through 2012, while rising in each of the intervening years. [18] Extreme poverty in the United States, meaning households living on less than $2 per person per day before government benefits, more than doubled from 636,000 to 1.46 million households (including 2.8 million children) between 1996 and 2011, with most of this increase occurring between late 2008 and early 2011. [23]

Median household income, by county, as of 2017. Median Household Income in USA, by county (2013-2017).jpg
Median household income, by county, as of 2017.

CBO income growth study

The nonpartisan Congressional Budget Office conducted a study analyzing household income throughout the income distribution, by combining the Census and IRS income data sources. Unlike the Census measure of household income, the CBO showed income before and after taxes, and by also taking into account household size. [24] Also, the CBO definition of income is much broader, and includes in kind transfers as well as all monetary transfers from the government. [24] The Census' official definition of money income excludes food stamps and the EITC, for example, while CBO includes it.

Between 1979 and 2011, gross median household income, adjusted for inflation, rose from $59,400 to $75,200, or 26.5%. This compares with the Census' growth of 10%. [18] However, once adjusted for household size and looking at taxes from an after-tax perspective, real median household income grew 46%, representing significant growth. [19]

While median gross household income showed much stronger growth than depicted by the Census, inequality was shown to still have increased. The top 10% saw gross household income grow by 78%, versus 26.5% for the median. The bottom 10%, using the same measure, saw higher growth than the median (40%). [19]

Mean household income

Another common measurement of personal income is the mean household income. Unlike the median household income, which divides all households in two halves, the mean income is the average income earned by American households. In the case of mean income, the income of all households is divided by the number of all households. [25] The mean income is usually more affected by the relatively unequal distribution of income which tilts towards the top. [26] As a result, the mean tends to be higher than the median income, with the top earning households boosting it. Overall, the mean household income in the United States, according to the US Census Bureau 2014 Annual Social and Economic Supplement, was $72,641. [27]

The US Census Bureau also provides a breakdown by self-identified ethnic groups as follows (as of March 2018):

Mean household income by ethnicity [27]
Ethnic categoryMean household income
Asian alone $114,105
White alone $89,632
Hispanic or Latino $68,319
Black $58,985

Mean vs. median household income

Median income is the amount which divides the income distribution into two equal groups, half having income above that amount, and half having income below that amount. Mean income (average) is the amount obtained by dividing the total aggregate income of a group by the number of units in that group. The means and medians for households and families are based on all households and families. Means and medians for people are based on people 15 years old and over with income.

US Census Bureau, Frequently Asked Question, published by First Gov. [25]

Aggregate income distribution

The aggregate income measures the combined income earned by all persons in a particular income group. In 2007, all households in the United States earned roughly $7.723 trillion. [28] One half, 49.98%, of all income in the US was earned by households with an income over $100,000, the top twenty percent. Over one quarter, 28.5%, of all income was earned by the top 8%, those households earning more than $150,000 a year. The top 3.65%, with incomes over $200,000, earned 17.5%. Households with annual incomes from $50,000 to $75,000, 18.2% of households, earned 16.5% of all income. Households with annual incomes from $50,000 to $95,000, 28.1% of households, earned 28.8% of all income. The bottom 10.3% earned 1.06% of all income. [29]

Household income and demographics

Racial and ethnic groups

White Americans made up roughly 75.1% of all people in 2000, [30] 87.93% of all households in the top 5% were headed by a person who identified as being White alone. Only 4.75% of all household in the top 5% were headed by someone who identified as Hispanic or Latino of any race, [31] versus 12.5% of persons identifying themselves as Hispanic or Latino in the general population. [30]

Overall, 86.01% of all households in the top two quintiles with upper-middle range incomes of over $55,331 were headed by someone identifying as White alone, while 7.21% were being headed by someone who identified as Hispanic and 7.37% by someone who identified as African American or Black. [31] Overall, households headed by Hispanics and African Americans were underrepresented in the top two quintiles and overrepresented in the bottom two quintiles. Households headed by people who identified as being Asian alone were also overrepresented among the top two quintiles. In the top five percent the percentage of Asians was nearly twice as high as the percentage of Asians among the general population. Whites were relatively even distributed throughout the quintiles only being underrepresented in the lowest quintile and slightly overrepresented in the top quintile and the top five percent. [31]

In terms of race in 2010 data, Asian American households had the highest median household income of $57,518, European-American households ranked second with $48,977, Hispanic or Latino households ranked third with $34,241. African-American or Black households had the lowest median household income of all races with $30,134. [32]

Ethnic groupAll householdsLowest fifthSecond fifthMiddle fifthFourth fifthHighest fifthTop 5%
White aloneNumber in 1000s92,70216,94018,42418,97819,21519,7215,029
Percentage81.93%74.87%81.42%83.87%84.92%87.16%87.93%
Asian aloneNumber in 1000s4,1406245937868711,265366
Percentage3.65%2.76%2.26%3.47%3.84%5.59%6.46%
BlackNumber in 1000s13,7924,4743,3392,6372,0531,287236
Percentage12.19%19.77%14.75%11.65%9.07%5.69%4.17%
Hispanic or Latino
(of any race)
Number in 1000s12,8383,0233,1302,8631,9311,204269
Percentage11.33%13.56%13.83%12.20%8.53%5.89%4.75%

Source: US Census Bureau, 2004 [31]

Education and gender

Median annual household income in accordance with the householder's educational attainment. The data only applies to household with a householder over the age of twenty-five. Education Income.jpg
Median annual household income in accordance with the householder's educational attainment. The data only applies to household with a householder over the age of twenty-five.

Household income as well as per capita income in the United States rise significantly as the educational attainment increases. [34] In 2005 graduates with a Master's in Business Administration (MBA) who accepted job offers were expected to earn a base salary of $88,626. They were also expected to receive an "average signing bonus of $17,428." [35]

According to the US Census Bureau persons with doctorates in the United States had an average income of roughly $81,400. The average for an advanced degree was $72,824, with men averaging $90,761 and women averaging $50,756 annually. Year-round full-time workers with a professional degree had an average income of $109,600 while those with a master's degree had an average income of $62,300. Overall, "…[a]verage earnings ranged from $18,900 for high school dropouts to $25,900 for high school graduates, $45,400 for college graduates and $99,300 for workers with professional degrees (M.D., O.D., D.P.T., D.P.M., D.O., J.D., Pharm.D., D.D.S., or D.V.M.)." [36]

Individuals with graduate degrees have an average per capita income exceeding the median household income of married couple families among the general population ($63,813 annually). [36] [37] Higher educational attainment did not, however, help close the income gap between the genders as the life-time earnings for a male with a professional degree were roughly forty percent (39.59%) higher than those of a female with a professional degree. The lifetime earnings gap between males and females was the smallest for those individuals holding an associate degrees with male life-time earnings being 27.77% higher than those of females. While educational attainment did not help reduce the income inequality between men and women, it did increase the earnings potential of individuals of both sexes, enabling many households with one or more graduate degree householders to enter the top household income quintile. [36] These data were not adjusted for preferential differences among men and women whom attend college. For example, men often study fields of engineering while women often pursue social sciences.

Household income also increased significantly with the educational attainment of the householder. The US Census Bureau publishes educational attainment and income data for all households with a householder who was aged twenty-five or older. The biggest income difference was between those with some college education and those who had a Bachelor's degree, with the latter making $23,874 more annually. Income also increased substantially with increased post-secondary education. While the median annual household income for a household with a householder having an associate degree was $51,970, the median annual household income for householders with a bachelor's degree or higher was $73,446. Those with doctorates had the second highest median household with a median of $96,830; $18,289 more than that for those at the master's degree level, but $3,170 lower than the median for households with a professional degree holding householder. [33]

CriteriaOverallLess than 9th gradeSome high schoolHigh school graduate or equivalentSome collegeAssociate degreeBachelor's degreeBachelor's degree or moreMaster's degreeProfessional degreeDoctoral degree
Median annual individual incomeMale, age 25+$33,517$15,461$18,990$28,763$35,073$39,015$50,916$55,751$61,698$88,530$73,853
Female, age 25+$19,679$9,296$10,786$15,962$21,007$24,808$31,309$35,125$41,334$48,536$53,003
Median annual household income [38] $62,625$26,587$30,100$44,970$55,563$64,263$91,772$100,021$108,231$139,069$140,110


Median household income in 2003 dollars according to educational attainment. Income Education 91 to 03.jpg
Median household income in 2003 dollars according to educational attainment.

The change in median personal and household since 1991 also varied greatly with educational attainment. The following table shows the median household income according to the educational attainment of the householder. All data is in 2003 dollars and only applies to householders whose householder is aged twenty-five or older. The highest and lowest points of the median household income are presented in bold face. [33] [39] Since 2003, median income has continued to rise for the nation as a whole, with the biggest gains going to those with associate degrees, bachelor's degree or more, and master's degrees. High-school dropouts fared worse with negative growth.

YearOverall MedianLess than 9th gradeSome high schoolHigh school graduateSome collegeAssociate degreeBachelor's degreeBachelor's degree or moreMaster's degreeProfessional degreeDoctoral degree
1991$40,873$17,414$23,096$37,520$46,296$52,289$64,150$68,845$72,669$102,667$92,614
1993$40,324$17,450$22,523$35,979$44,153$49,622$64,537$70,349$75,645$109,900$93,712
1995$42,235$18,031$21,933$37,609$44,537$50,485$63,357$69,584$77,865$98,302$95,899
1997$43,648$17,762$22,688$38,607$45,734$51,726$67,487$72,338$77,850$105,409$99,699
1999$46,236$19,008$23,977$39,322$48,588$54,282$70,925$76,958$82,097$110,383$107,217
2001$42,900$18,830$24,162$37,468$47,605$53,166$69,796$75,116$81,993$103,918$96,442
2003$45,016$18,787$22,718$36,835$45,854$56,970$68,728$73,446$78,541$100,000$96,830
Average$43,376$18,183$23,013$37,620$46,109$51,934$66,997$72,376$78,094$104,368$94,487

Source: US Census Bureau, 2003 [33]

Age of householder

U.S. family pre-tax income and net worth distribution for 2013 and 2016, from the Federal Reserve Survey of Consumer Finances. U.S. Income and Net Worth Distribution.png
U.S. family pre-tax income and net worth distribution for 2013 and 2016, from the Federal Reserve Survey of Consumer Finances.

Household income in the United States varies substantially with the age of the person who heads the household. Overall, the median household income increased with the age of householder until retirement age when household income started to decline. [41] The highest median household income was found among households headed by working baby-boomers. [41]

Households headed by persons between the ages of 45 and 54 had a median household income of $61,111 and a mean household income of $77,634. The median income per member of household for this particular group was $27,924. The highest median income per member of household was among those between the ages of 54 and 64 with $30,544 [The reason this figure is lower than the next group is because pensions and Social Security add to income while a portion of older individuals also have work-related income.]. [41]

The group with the second highest median household income, were households headed by persons between the ages 35 and 44 with a median income of $56,785, followed by those in the age group between 55 and 64 with $50,400. Not surprisingly the lowest income group was composed of those households headed by individuals younger than 24, followed by those headed by persons over the age of 75. Overall, households headed by persons above the age of seventy-five had a median household income of $20,467 with the median household income per member of household being $18,645. These figures support the general assumption that median household income as well as the median income per member of household peaked among those households headed by middle aged persons, increasing with the age of the householder and the size of the household until the householder reaches the age of 64. With retirement income replacing salaries and the size of the household declining, the median household income decreases as well. [41]

Household size

While median household income has a tendency to increase up to four persons per household, it declines for households beyond four persons. For example, in the state of Alabama in 2004, two-person households had a median income of $39,755, with $48,957 for three-person households, $54,338 for four-person households, $50,905 for five-person households, $45,435 for six-person households, with seven-or-more-person households having the second lowest median income of only $42,471. [42]

Geography

Considering other racial and geographical differences in regards to household income, it should come as no surprise that the median household income varies with race, size of household and geography. The state with the highest median household income in the United States as of the US Census Bureau 2009 is Maryland with $69,272, followed by New Jersey, Connecticut and Alaska, making the Northeastern United States the wealthiest area by income in the entire country. [43]

Regionally, in 2010, the Northeast reached a median income of $53,283, the West, $53,142, the South, $45,492, and the Midwest, $48,445. [44] Each figure represents a decline from the previous year.

Income by state

In 2007, the median household income by state ranged from $36,338 in Mississippi to $68,080 in New Hampshire. Despite having the highest median home price in the nation [45] and home prices that far outpaced incomes, [46] California ranked only eighth in income that year, with a median household income of $59,984. While California's median income was not near enough to afford the average California home or even a starter home, West Virginia, which had one of the nation's lowest median household incomes, also had the nation's lowest median home price. [45] [47]

When grouped by Census Bureau Region, of the 15 states that, in 2017, had the highest median household income, only Minnesota is located in the Mid-West. Six are in New England (Connecticut, Massachusetts, New Hampshire, New Jersey and Rhode Island), three are South Atlantic states (Washington D.C., Maryland and Virginia) while the remaining six are in the West (Alaska, California, Colorado, Hawaii, Washington and Utah).

The southern states had, on average, the lowest median household income, with nine of the country's fifteen poorest states located in the South. However, most of the poverty in the South is located in rural areas. Metropolitan areas such as Atlanta, Nashville, Charlotte, Raleigh, Birmingham, Dallas, Houston, and Miami are areas within the southern states that have above average income levels. Overall, median household income tended to be the highest in the nation's most urbanized northeastern, upper midwestern and west coast states, while rural areas, mostly in the southern and mountain states (like New Mexico, Montana and Idaho), had the lowest median household income. [47]

As of 2017, the median household income ranged from $43,469 in West Virginia to $82,372 in the District of Columbia.

All data is from the 2007-2017 American Community Survey 1-Year Estimates. [48]


Rank+/- *State20172016201520142013201220112010200920082007
1+15 District of Columbia $82,336$75,506$75,628$71,648$67,572$65,246$66,583$63,124$59,290$57,936$54,317
2-1 Maryland $80,776$78,945$75,847$73,971$72,483$71,836$70,004$68,854$69,272$70,545$68,080
3-1 New Jersey $80,088$76,126$72,222$72,919$70,165$69,667$67,458$67,681$68,342$70,373$67,035
4+1 Hawaii $77,765$74,511$73,486$69,592$68,020$66,259$61,821$63,030$64,098$67,214$63,746
5+2 Massachusetts $77,385$75,297$70,628$69,160$66,768$65,339$62,859$62,072$64,081$65,401$62,365
6-3 Connecticut $74,168$73,433$71,346$70,048$67,098$67,276$65,753$64,032$67,034$68,595$65,967
7-1 New Hampshire $73,381$70,936$70,303$66,532$64,230$63,280$62,647$61,042$60,567$63,731$62,369
8-4 Alaska $73,181$76,440$73,355$71,583$72,23767,712$67,825$64,576$66,953$68,460$64,333
9-1 California $71,805$67,739$64,500$61,933$60,190$58,328$57,287$57,708$58,931$61,021$59,948
10-1 Virginia $71,535$68,114$66,262$64,902$62,666$61,741$61,882$60,674$59,330$61,233$59,562
11- Washington $70,979$67,106$64,129$61,366$58,405$57,573$56,835$55,631$56,548$58,078$55,212
12- Colorado $69,117$65,685$63,909$61,303$58,823$56,765$55,387$54,046$55,430$56,993$55,212
13-3 Minnesota $68,388$65,599$63,488$61,481$60,702$58,906$56,954$55,459$55,616$57,288$55,802
14-1 Utah $68,358$65,977$62,912$60,922$59,770$57,049$55,869$54,744$55,117$56,633$55,109
15+4 New York $64,894$62,909$60,850$58,878$57,369$56,448$55,246$54,148$54,659$56,013$53,514
16+2 Rhode Island $63,870$60,596$58,073$54,891$55,902$54,554$53,636$52,254$54,119$55,701$53,568
17- Illinois $62,992$60,960$59,588$57,444$56,210$55,137$53,234$52,972$53,966$56,235$54,124
18-3 Delaware $62,852$61,757$61,255$59,716$57,846$54,554$58,81455,847$56,860$57,989$54,610
19+20 North Dakota $61,843$60,656$60,557$59,029$55,759$53,585$51,704$48,670$47,827$46,032$43,531
20- Wyoming $60,434$59,882$60,214$57,055$58,752$54,901$56,322$53,512$52,664$53,207$51,731
21+4 Oregon $60,212$57,532$54,148$51,075$50,251$49,161$46,816$46,560$48,457$50,169$48,730
22+11 Nebraska $59,970$56,927$54,996$52,686$51,440$50,723$50,296$52,504$48,408$49,693$47,085
23-2 Wisconsin $59,305$56,811$55,638$52,622$51,467$51,059$50,395$49,001$49,993$52,094$50,578
24+5 Texas $59,206$56,565$55,653$53,035$51,704$50,740$49,392$48,615$48,259$50,043$47,548
25+1 Pennsylvania $59,195$56,907$55,702$53,234$52,007$51,230$50,228$49,288$49,520$50,713$48,576
26+6 Iowa $58,570$56,247$54,736$53,712$52,229$50,957$49,427$47,961$48,044$48,980$47,292
27-13 Nevada $58,003$55,180$52,431$51,450$51,230$49,760$48,927$51,001$53,341$56,361$55,062
28-6 Vermont $57,513$57,677$56,990$54,166$52,578$52,997$52,776$49,406$51,618$52,104$49,907
29-6 Arizona $56,581$53,558$51,492$50,068$48,510$47,826$46,709$46,789$48,745$50,958$49,889
30+11 South Dakota $56,894$54,467$53,017$50,979$48,947$48,362$48,321$45,904$45,043$46,032$43,424
31-1 Kansas $56,422$54,935$53,906$52,504$50,972$50,241$48,264$48,257$47,817$50,177$47,451
32+4 Maine $56,277$53,079$51,494$49,462$46,974$46,709$46,033$45,815$45,734$46,581$45,888
33-9 Georgia $56,183$53,559$51,244$49,321$47,829$47,209$46,007$46,430$44,736$50,861$49,136
34-7 Michigan $54,909$52,492$51,084$49,847$48,273$46,859$45,981$45,413$45,255$48,591$47,950
35-4 Indiana $54,181$52,314$50,532$49,446$47,529$46,974$46,438$44,613$45,424$47,966$47,448
36-2 Ohio $54,021$52,334$51,075$49,308$48,081$46,829$45,749$45,090$45,395$47,988$46,597
37- Missouri $53,578$51,746$50,238$48,363$46,931$45,321$45,247$44,301$45,229$46,867$45,114
38+2 Montana $53,386$50,027$49,509$46,328$46,972$45,076$44,222$42,666$42,322$43,654$43,531
39-1 North Carolina $52,752$50,584$47,830$46,556$45,906$45,150$43,916$43,326$43,674$46,549$44,670
40-12 Florida $52,594$50,860$49,426$47,463$46,036$45,040$44,299$44,409$44,736$47,778$47,804
41-6 Idaho $52,225$51,807$48,275$47,861$46,783$45,489$43,341$43,490$44,926$47,576$46,253
42+1 Tennessee $51,340$48,547$47,275$44,361$44,297$42,764$41,693$41,461$41,725$43,614$42,367
43-1 South Carolina $50,570$49,501$47,238$45,238$44,163$43,107$43,916$42,018$42,442$44,625$43,329
44- Oklahoma $50,051$49,176$48,568$47,529$45,690$44,312$43,225$42,072$41,664$42,822$41,567
45+3 Kentucky $48,375$46,659$44,765$42,958$43,399$41,724$41,141$40,062$40,072$41,538$40,267
46+1 Alabama $48,123$46,257$44,765$42,830$42,849$41,574$41,415$40,474$40,489$42,666$40,554
47-2 New Mexico $46,744$46,748$45,382$44,803$43,872$42,558$41,963$42,090$43,028$43,508$41,452
48-2 Louisiana $46,145$45,146$45,727$44,555$44,164$42,944$41,734$42,505$42,429$43,733$40,926
49- Arkansas $45,869$45,907$42,798$44,922$39,376$39,018$41,302$38,587$36,538$39,586$38,134
50+1 Mississippi $43,529$41,754$40,593$39,680$37,963$37,095$36,919$36,851$36,646$37,790$36,338
51-1 West Virginia $43,469$43,385$42,019$41,059$41,253$40,196$38,482$37,218$37,435$37,989$37,060


*change since 2007

The median personal income per person, after adjusting for costs of living with local regional price parities and the national PCE price index, averaged $47,807 in 2016 (in 2012 chained dollars). Median adjusted personal income per capita varied from $39,901 in Mississippi to $61,601 in Connecticut (and $64,363 in the District of Columbia). The states closest to the national average were California and Vermont, at $48,384 and $47,971 respectively. [49]

Social class

Household income is one of the most commonly used measures of income and, therefore, also one of the most prominent indicators of social class. Household income and education do not, however, always reflect perceived class status correctly. Sociologist Dennis Gilbert acknowledges that "... the class structure... does not exactly match the distribution of household income" with "the mismatch [being] greatest in the middle..." (Gilbert, 1998: 92) As social classes commonly overlap, it is not possible to define exact class boundaries.

According to Leonard Beeghley [ citation needed ] a household income of roughly $95,000 would be typical of a dual-earner middle class household while $60,000 would be typical of a dual-earner working class household and $18,000 typical for an impoverished household. William Thompson and Joseph Hickey[ citation needed ] see common incomes for the upper class as those exceeding $500,000 with upper middle class incomes ranging from the high 5-figures to most commonly in excess of $100,000. They claim the lower middle class ranges from $35,000 to $75,000; $16,000 to $30,000 for the working class and less than $2,000 for the lower class.

Academic class models
Dennis Gilbert, 2002William Thompson & Joseph Hickey, 2005 Leonard Beeghley, 2004
ClassTypical characteristicsClassTypical characteristicsClassTypical characteristics
Capitalist class (1%)Top-level executives, high-rung politicians, heirs. Ivy League education common.Upper class (1%)Top-level executives, celebrities, heirs; income of $500,000+ common. Ivy league education common.The super-rich (0.9%)Multi-millionaires whose incomes commonly exceed $350,000; includes celebrities and powerful executives/politicians. Ivy League education common.
Upper middle class [1] (15%)Highly-educated (often with graduate degrees), most commonly salaried, professionals and middle management with large work autonomy.Upper middle class [1] (15%)Highly-educated (often with graduate degrees) professionals & managers with household incomes varying from the high 5-figure range to commonly above $100,000.The rich (5%)Households with net worth of $1 million or more; largely in the form of home equity. Generally have college degrees.
Middle class (plurality/
majority?; ca. 46%)
College-educated workers with considerably higher-than-average incomes and compensation; a man making $57,000 and a woman making $40,000 may be typical.
Lower middle class (30%)Semi-professionals and craftsmen with a roughly average standard of living. Most have some college education and are white-collar.Lower middle class (32%)Semi-professionals and craftsmen with some work autonomy; household incomes commonly range from $35,000 to $75,000. Typically, some college education.
Working class (30%)Clerical and most blue-collar workers whose work is highly routinized. Standard of living varies depending on number of income earners, but is commonly just adequate. High school education.
Working class (32%)Clerical, pink- and blue-collar workers with often low job security; common household incomes range from $16,000 to $30,000. High school education.Working class
(ca. 40–45%)
Blue-collar workers and those whose jobs are highly routinized with low economic security; a man making $40,000 and a woman making $26,000 may be typical. High school education.
Working poor (13%)Service, low-rung clerical and some blue-collar workers. High economic insecurity and risk of poverty. Some high school education.
Lower class (ca. 14–20%)Those who occupy poorly-paid positions or rely on government transfers. Some high school education.
Underclass (12%)Those with limited or no participation in the labor force. Reliant on government transfers. Some high school education.The poor (ca. 12%)Those living below the poverty line with limited to no participation in the labor force; a household income of $18,000 may be typical. Some high school education.
References: Gilbert, D. (2002) The American Class Structure: In An Age of Growing Inequality. Belmont, CA: Wadsworth, ISBN   0534541100. (see also Gilbert Model);
Thompson, W. & Hickey, J. (2005). Society in Focus. Boston, MA: Pearson, Allyn & Bacon; Beeghley, L. (2004). The Structure of Social Stratification in the United States. Boston, MA: Pearson, Allyn & Bacon.
1 The upper middle class may also be referred to as "Professional class" Ehrenreich, B. (1989). The Inner Life of the Middle Class. NY, NY: Harper-Collins.

Distribution of household income

Distribution of household income in 2014 according to US Census data

Percentage of persons and households in each of the income groups shown. Personal Household Income U.png
Percentage of persons and households in each of the income groups shown.
The percent of households with six figure incomes and individuals with incomes in the top 10%, exceeding $77,500. Race 6 figure household and.png
The percent of households with six figure incomes and individuals with incomes in the top 10%, exceeding $77,500.
US Census Bureau figures for 2014
Income of HouseholdNumber (thousands) [50] PercentagePercentileMean Income [50] Mean number of earners [51] Mean size of household [51]
Total124,587$75,7381.282.54
Under $5,00045713.67%0$1,0800.201.91
$5,000 to $9,99943203.47%3.67th$7,9360.341.78
$10,000 to $14,99967665.43%7.14th$12,3170.391.71
$15,000 to $19,99967795.44%12.57th$17,3380.541.90
$20,000 to $24,99968655.51%18.01th$22,1620.732.07
$25,000 to $29,99963635.11%23.52th$27,1010.822.19
$30,000 to $34,99962325.00%28.63th$32,0580.942.27
$35,000 to $39,99958574.70%33.63th$37,0611.042.31
$40,000 to $44,99954304.36%38.33th$41,9791.152.40
$45,000 to $49,99950604.06%42.69th$47,2071.242.52
$50,000 to $54,99950844.08%46.75th$51,9861.322.54
$55,000 to $59,99942203.39%50.83th$57,0651.412.56
$60,000 to $64,99944773.59%54.22th$62,0161.462.64
$65,000 to $69,99937092.98%57.81th$67,0811.512.67
$70,000 to $74,99937373.00%60.79th$72,0501.572.73
$75,000 to $79,99934842.80%63.79th$77,0231.602.79
$80,000 to $84,99931422.52%66.58th$81,9661.632.79
$85,000 to $89,99927502.21%69.11th$87,1011.772.90
$90,000 to $94,99926652.14%71.31th$92,0331.822.96
$95,000 to $99,99923391.88%73.45th$97,1611.812.97
$100,000 to $104,99926792.15%75.33th$101,9211.793.01
$105,000 to $109,99920701.66%77.48th$107,1871.883.01
$110,000 to $114,99919221.54%79.14th$112,0691.933.12
$115,000 to $119,99916231.30%80.68th$117,1331.983.14
$120,000 to $124,99918631.50%81.99th$122,1271.933.09
$125,000 to $129,99914521.17%83.48th$127,1661.993.12
$130,000 to $134,99915121.21%84.65th$131,8632.003.18
$135,000 to $139,99912190.98%85.86th$137,2841.983.11
$140,000 to $144,99912901.04%86.84th$142,1991.973.03
$145,000 to $149,99910240.82%87.87th$147,1302.013.11
$150,000 to $154,99911460.92%88.70th$151,9401.853.12
$155,000 to $159,9998480.68%89.62th$157,1772.083.15
$160,000 to $164,9998750.70%90.30th$162,0192.023.13
$165,000 to $169,9997860.63%91.00th$167,1012.103.16
$170,000 to $174,9997170.58%91.63th$172,1692.173.21
$175,000 to $179,9996070.49%92.21th$177,1872.193.28
$180,000 to $184,9996190.50%92.69th$182,0552.033.19
$185,000 to $189,9995560.45%93.19th$187,2992.033.20
$190,000 to $194,9994850.39%93.64th$192,2412.193.29
$195,000 to $199,9994360.35%94.03th$197,2112.233.27
$200,000 to $249,99932492.61%94.38th$220,2672.083.24
$250,000 and over37573.02%96.98th$402,476

See also

General:

Related Research Articles

Standard of living in the United States

The standard of living in the United States is high by the standards that most economists use, and for many decades throughout the 20th century, the United States was recognized as having the highest standard of living in the world. Per capita income is high but also less evenly distributed than in most other developed countries; as a result, the United States fares particularly well in measures of average material well being that do not place weight on equality aspects.

Social class in the United States

Social class in the United States is a controversial issue, having many competing definitions, models, and even disagreements over its very existence. Many Americans believe that in the country there are just three classes: the American rich; the American middle class; the American poor. More complex models that have been proposed describe as many as a dozen class levels; while still others deny the very existence, in the European sense, of social class in American society. Most definitions of class structure group people according to wealth, income, education, type of occupation, and membership in a specific subculture or social network. Most of the social classes entirely ignore the existence of parallel Black, Hispanic and minorities societies.

Income inequality metrics or income distribution metrics are used by social scientists to measure the distribution of income and economic inequality among the participants in a particular economy, such as that of a specific country or of the world in general. While different theories may try to explain how income inequality comes about, income inequality metrics simply provide a system of measurement used to determine the dispersion of incomes. The concept of inequality is distinct from poverty and fairness.

Upper middle class sociological concept

In sociology, the upper middle class is the social group constituted by higher status members of the middle class. This is in contrast to the term lower middle class, which is used for the group at the opposite end of the middle-class stratum, and to the broader term middle class. There is considerable debate as to how the upper middle class might be defined. According to sociologist Max Weber the upper middle class consists of well-educated professionals with postgraduate degrees and comfortable incomes.

Median income is the amount that divides the income distribution into two equal groups, half having income above that amount, and half having income below that amount. Mean income (average) is the amount obtained by dividing the total aggregate income of a group by the number of units in that group. Mode income is the most frequently occurring income in a given income distribution.

Home-ownership in the United States

The home-ownership rate in the United States is percentage of homes that are owned by their occupants. In 2009, it remained similar to that in some other post-industrial nations with 67.4% of all occupied housing units being occupied by the unit's owner. Home ownership rates vary depending on demographic characteristics of households such as ethnicity, race, type of household as well as location and type of settlement. In 2018, homeownership dropped to a lower rate than it was in 1994, with a rate of 64.2%.

The American middle class is a social class in the United States. While the concept is typically ambiguous in popular opinion and common language use, contemporary social scientists have put forward several ostensibly congruent theories on the American middle class. Depending on the class model used, the middle class constitutes anywhere from 25% to 66% of households.

Educational attainment in the United States

The educational attainment of the U.S. population is similar to that of many other industrialized countries with the vast majority of the population having completed secondary education and a rising number of college graduates that outnumber high school dropouts. As a whole, the population of the United States is spending more years in formal educational programs. As with income, levels differ by race, age, household configuration and geography.

Income in the United States

Income in the United States is measured by the United States Department of Commerce either by household or individual. The differences between household and personal income is considerable since 42% of households, the majority of those in the top two quintiles with incomes exceeding $57,658, now have two income earners.

Economic mobility

Economic mobility is the ability of an individual, family or some other group to improve their economic status—usually measured in income. Economic mobility is often measured by movement between income quintiles. Economic mobility may be considered a type of social mobility, which is often measured in change in income.

Personal income in the United States

Personal income is an individual's total earnings from wages, investment interest, and other sources. The Bureau of Labor Statistics reported a median personal income of $865 weekly for all full-time workers in 2017. The U.S Bureau of the Census has the annual median personal income at $31,099 in 2016. Inflation-adjusted ("real") per-capita disposable personal income rose steadily in the U.S. from 1945 to 2008, but has since remained generally level.

Affluence refers to an individual's or household's economical and financial advantage in comparison to a given reference group. It may be assessed through either income or wealth.

The terms average Joe, ordinary Joe, Joe Sixpack, Joe Lunchbucket, Joe Snuffy, Joe Schmo and ordinary Jane, average Jane, and plain Jane, are used primarily in North America to refer to a completely average person, typically an average American. It can be used both to give the image of a hypothetical "completely average person" or to describe an existing person. Parallel terms in other languages for local equivalents exist worldwide.

American lower class

In the United States, the lower class are those at or near the lower end of the socio-economic hierarchy. As with all social classes in the United States, the lower class is loosely defined and its boundaries and definitions subject to debate and ambiguous popular opinions. Sociologists such as W. Lloyd Warner, Dennis Gilbert and James Henslin divide the lower classes into two. The contemporary division used by Gilbert divides the lower class into the working poor and underclass. Service and low-rung manual laborers are commonly identified as being among the working poor. Those who do not participate in the labor force and rely on public assistance as their main source of income are commonly identified as members of the underclass. Overall the term describes those in easily filled employment positions with little prestige or economic compensation who often lack a high school education and are to some extent disenfranchised from mainstream society.

Wealth inequality in the United States

Wealth inequality in the United States is the unequal distribution of assets among residents of the United States. Wealth includes the values of homes, automobiles, personal valuables, businesses, savings, and investments. The net worth of U.S. households and non-profit organizations was $94.7 trillion in the first quarter of 2017, a record level both in nominal terms and purchasing power parity. If divided equally among 124 million U.S. households, this would be $760,000 per family; however, the bottom 50% of families, representing 62 million American households, average $11,000 net worth. From an international perspective, the difference in US median and mean wealth per adult is over 600%.

In sociology, the upper middle class of the United States is the social group constituted by higher-status members of the middle class. This is in contrast to the term lower middle class, which refers to the group at the opposite end of the middle class scale. There is considerable debate as to how the upper middle class might be defined. According to Max Weber, the upper middle class consists of well-educated professionals with graduate degrees and comfortable incomes.

Poverty in the United States Poverty in the U.S.A.

Poverty in the United States covers the subsection of people of the United States that are in a state of deprivation, lacking the usual or socially acceptable amount of money or material possessions. It is usually understood as a relative measure of poverty within the United States which is a relatively wealthy country by international standards. The most common measure of poverty in the U.S. is the "poverty threshold" set by the U.S. government. This measure recognizes poverty as a lack of those goods and services commonly taken for granted by members of mainstream society. The official threshold is adjusted for inflation using the consumer price index.

In the United States, despite the efforts of equality proponents, income inequality persists among races and ethnicities. Asian Americans have the highest average income, followed by white Americans, Latino Americans, African Americans, and Native Americans. A variety of explanations for these differences have been proposed—such as differing access to education, two parent home family structure, high school dropout rates and experience of discrimination—and the topic is highly controversial.

Causes of income inequality in the United States describes why changes in the country's income distribution are occurring. This topic is subject to extensive ongoing research, media attention, and political interest, as it involves how the national income of the country is split among its people at various income levels.

References

  1. Federal Reserve Economic Data-Real Median Household Income-Retrieved September 15, 2018
  2. "Income, Poverty and Health Insurance Coverage in the U.S.: 2017". Census.gov. Retrieved September 15, 2018.
  3. "Emmanuel Saez-Income and Wealth Inequality-October 2014" (PDF). Eml.berkeley.edu. Retrieved October 14, 2017.
  4. Tcherneva, Pavlina R. (August 2014). "This Chart Shows Just How (Un)Equal Things Are During A 'Champion' Of The 99%'s Administration". Independent Journal Review. Retrieved September 13, 2014.
  5. Binyamin, Appelbaum (September 4, 2014). "Fed Says Growth Lifts the Affluent, Leaving Behind Everyone Else". New York Times. Retrieved September 13, 2014.
  6. "Census Long Form Definition". United States Department of Housing and Urban Development. July 30, 2009. Archived from the original on October 8, 2012.
  7. "Glossary: household income". South Carolina Community Profiles. Archived from the original on April 21, 2006. Retrieved August 10, 2006.
  8. Gilbert, Dennis (1998). The American Class Structure. New York: Wadsworth Publishing. ISBN   0-534-50520-1.
  9. "About Income". United States Census Bureau. United States Census Bureau. Retrieved April 17, 2019.
  10. Neil Irwin (September 17, 2014). "You Can't Feed a Family With G.D.P." The New York Times.
  11. Paul Krugman (November 12, 2014). "On Income Stagnation". The New York Times.
  12. "U.S. Household Incomes Rose to Record in 2016 as Poverty Fell". Bloomberg.com. September 12, 2017. Retrieved October 14, 2017.
  13. "The American Middle Class Hasn't Gotten a Raise in 15 Years". Five Thirty Eight. September 22, 2014. Retrieved September 29, 2014.
  14. Annie Lowrey. "Will US Economy Ever Be As Good As in the '90s?". Daily Intelligencer.
  15. "2013 Summary of Findings - The Henry J. Kaiser Family Foundation". Kff.org. Retrieved October 14, 2017.
  16. "Monetary policy and long-term trends". Voxeu.org. Retrieved October 14, 2017.
  17. "FRED Graph". Research.stlouisfed.org. Retrieved October 14, 2017.
  18. 1 2 3 "Historical Income Tables - Households - U.S Census Bureau". Census.gov. Retrieved October 14, 2017.
  19. 1 2 3 "The Distribution of Household Income and Federal Taxes, 2011". Cbo.gov. Retrieved October 14, 2017.
  20. FRED-Real Median Household Income-Retrieved April 20, 2019
  21. "WIC Income Eligibility Guidelines". United States Department of Agriculture. September 12, 2013.
  22. "Federal Student Aid". U.S. Department of Education. September 12, 2013.
  23. Shaefer, H. Luke; Edin, Kathryn (February 2012). "Extreme Poverty in the United States, 1996 to 2011" (PDF). Policy Brief. National Poverty Center (28).
  24. 1 2 "The Distribution of Household Income and Federal Taxes, 2011" (PDF). Congressional Budget Office.
  25. 1 2 "U.S. Census Bureau FAQs: What is the difference between a median and a mean?". United States Census Bureau. Archived from the original on September 22, 2006. Retrieved June 29, 2006.
  26. "US Census Bureau on the nature the median in determining wealth" (PDF). May 2003. Retrieved June 29, 2006.
  27. 1 2 "Race and Hispanic Origin of Householder-Households by Median and Mean Income". US Census Bureau. March 2018. Retrieved March 25, 2019.
  28. "US Census 2007 Economic Survey, income data". US Census Bureau. May 2008.
  29. Hansen, Steven. "High Rate Of Spending Continues For Households". NASDAQ. NASDAQ. Retrieved January 23, 2019.
  30. 1 2 "US Census Bureau, 2000 Census racial data" . Retrieved June 29, 2006.
  31. 1 2 3 4 "US Census Bureau 2005 Economic survey, racial income distribution". Archived from the original on July 7, 2006. Retrieved June 29, 2006.
  32. "US Census Bureau, median household income according to certain demographic characteristics". August 30, 2005. Archived from the original on June 18, 2006. Retrieved June 29, 2006.
  33. 1 2 3 4 5 "Educational attainment and median household income". Archived from the original on September 3, 2006. Retrieved September 24, 2006.
  34. "US Census Bureau, Income by education and sex". Archived from the original on April 11, 2006. Retrieved June 30, 2006.
  35. "Wall Street Journal on MBA salary base". 2006. Archived from the original on March 18, 2007. Retrieved June 30, 2006.
  36. 1 2 3 "US Census Bureau on Education and Income" (PDF). Retrieved June 30, 2006.
  37. "Infoplease, median household income". Infoplease.com. Retrieved June 29, 2006.
  38. "Education Attainment of Householder-Households with Householder 25 Years Old or Over by Median and Mean Income, 1991-2017". Historical Income Tables. US Census Bureau. Retrieved March 26, 2019.
  39. "Personal income and educational attainment, US Census Bureau". Archived from the original on September 7, 2006. Retrieved September 24, 2006.
  40. Federal Reserve Bulletin. September 2017, Vol. 103, No. 3. See PDF: Changes in U.S. Family Finances from 2013 to 2016: Evidence from the Survey of Consumer Finances. Table 1 (on the left) is taken from page 4 of the PDF. Table 2 (on the right) is taken from page 13. See: Survey of Consumer Finances and more data.
  41. 1 2 3 4 "US Census Bureau median household income by age of householder". Archived from the original on May 28, 2006. Retrieved July 7, 2006.
  42. "US Census Bureau, median family income by family size". Archived from the original on June 26, 2006. Retrieved June 29, 2006.
  43. "US Census Bureau, median household income by state". Archived from the original on June 28, 2006. Retrieved June 29, 2006.
  44. DeNavas-Walt, Carmen; Proctor, Bernadette D.; Smith, Jessica C. (September 2011). Income, Poverty, and Health Insurance Coverage in the United States: 2010 (PDF). U.S. Census Bureau.[ page needed ]
  45. 1 2 "Median home price by state". Clevelandfed.org. November 2005. Archived from the original on June 14, 2006. Retrieved July 1, 2006.
  46. "The State of the Nation's Housing 2002" (PDF). Joint Center for Housing Studies of Harvard University. Archived from the original (PDF) on November 10, 2011.
  47. 1 2 "US Census Bureau, median household income by state 2004". Archived from the original on June 28, 2006. Retrieved July 1, 2006.
  48. Bureau, U.S. Census. "American FactFinder - Results". factfinder.census.gov. Retrieved May 14, 2019.
  49. Bureau of Economic Analysis: Regional Data. RPI1 Real Personal Income per capita by state. U.S. Department of Commerce. Updated September 25, 2018. Retrieved October 8, 2018.
  50. 1 2 ""Income Distribution to $250,000 or More for Households: 2014"". US Census Bureau. Retrieved March 25, 2016.
  51. 1 2 ""Selected Characteristics of Households, by Total Money Income in 2014"" (XLS). US Census Bureau. Retrieved March 21, 2016.[ permanent dead link ]