Permanent musical accompaniment to this post: Party Like It’s 1999.
The median income for U.S. households is now slightly higher than what the median income was for households . . . in 1999. Americans are finally making more money than we were in 1999:
Adjusted for inflation, median household income rose to $59,039, which is up 3.2 percent from 2015 to 2016, according to Census Bureau statistics. The previous highest median income, the Associated Press reported, was $58,665, which was recorded in 1999.
It took 18 years, but the American median income is finally back to where it was before the 2001 recession.
The report covers the final year of the Obama administration, in which poverty rates also decreased from 13.5 percent to 12.7 percent. In real numbers, that’s a drop of 2.5 million people, according to USA Today. The number represent the first time since the recession that the rate wasn’t higher than levels prior to the recession.
In a year filled with debate on health care, the amount of Americans who have health insurance increased by 900,000 to 28.1 million, and the percentage of Americans not covered by insurance dropped from 9.1 percent to 8.8 percent.
Despite improved unemployment rates, wages have only grown sluggishly, USA Today elaborated:
Many economists have bemoaned average wage growth that has risen just modestly despite the low 4.4 percent unemployment rate that’s making it tougher for employers to find qualified workers. In 2016, average wage gains accelerated to 2.9 percent from a tepid 2 percent earlier in the recovery, but they’ve retreated to 2.5 percent in recent months.
The Census Bureau’s median household income measure, however, is broader because it also includes bonuses, Social Security income, public assistance payments, and interest and dividends from investments, among other sources. Income gains were also bolstered by the healthy 2.2 million jobs the economy created in 2016.
If you don’t feel like partying over this recovery in median household income, you may have good reason. No wonder so many American men feel like they’re falling behind. They earn as much as they did in 1972.
One of the more striking parts of the U.S. Census Bureau’s 2016 income, poverty and health insurance report is its data on income stagnation. While incomes went up in 2016, the current median household nonetheless brings in about as much as its counterpart in 1999 did — that is, around $59,000 (in inflation-adjusted dollars).
If you look at men’s earnings alone, though, the trends are worse.
Today’s full-time, year-round male worker earns a median of $52,000. That’s roughly what his counterpart made in 1972.
Full-time, year-round working women’s earnings, meanwhile, have increased in that time period, and are now at their highest level on record. With a median of $48,000, women’s earnings are still way behind men’s earnings of course. But the direction women’s wages are moving is nonetheless upward. While women might feel like they’re making progress, men understandably might feel like they’re treading water.
Remember that these figures are also for full-time, year-round workers only. Men’s participation in the labor force has steadily declined over this same time period, which means the trends for median male earnings would look even worse if you included the growing pool of men who have no earnings at all. (Women’s labor force participation peaked in 2000 and has fallen since then, but it’s still much higher than it was a generation or two ago.)
African Americans were worse off financially in 2016 than they were in 2000.
The median income for an African American household was $39,490 last year, according to U.S. Census Bureau data released this week. It was $41,363 in 2000. (Both figures are in 2016 dollars, so they have been adjusted for inflation).
African Americans are the only racial group the Census Bureau identifies that has been left behind. White, Asian and Hispanic households have all seen at least modest income gains since 2000.
The uptick in incomes for so many Americans helped lift the overall median U.S. household income to $59,039 last year, the highest level ever recorded by the Census Bureau. That figure surpassed the previous record set in 1999, during the last period of strong economic growth.
But the overall trend masks the fact that African Americans, as a group, have not recovered.
* * *
The black unemployment rate is nearly double the white unemployment rate. It’s been that way since the Labor Department began keeping track of unemployment by race in the early 1970s. Black Americans also receive substantially lower wages than whites and Asians.
“Character, talent and insight are evident in individuals from all income classes. But not all individuals get an equal chance to prove their mettle,” said Mary Coleman, senior vice president of Economic Mobility Pathways, a Boston-based nonprofit group.
The Census data also showed that almost 1 in 4 black households lives in poverty. The poverty rate among African Americans (22 percent) is more than double the poverty rate among whites (9 percent).
African Americans have the lowest earnings of any racial group by far. While median household income for African Americans was just over $39,000 last year, it was over $47,000 for Hispanics, over $65,000 for whites and over $81,000 for Asian American households.
Lower incomes make it harder to get by, let alone get ahead. African Americans are much less likely than whites to own homes or invest in the stock market, in part because low wages leave them with limited extra income to save up for a down payment.
African Americans also are more likely to lack health insurance. The Census released data this week showing that the uninsured rate for the nation overall was 8.8 percent, an all-time low. But it was 10.5 percent for African Americans.
Many books and research papers have delved into why African Americans continue to struggle financially. Williams Rodgers, chief economist at the Heldrich Center for Workforce Development at Rutgers University, is one of the scholars who has studied the issue extensively. He co-authored a report last year for the left-leaning Economic Policy Institute that found that black-white wage gaps are larger today than they were in 1979.
The study noted that even when African Americans attend college and actively work to expand their skills and networks, they still earn far less than whites with similar educational background. In fact, the wage gap has expanded the most between college educated blacks and whites.
His conclusion after years of looking at the data and trends? “Wage gaps are growing primarily because of discrimination,” said Rodgers.
The small silver lining in the latest census data is that African American incomes grew nearly 6 percent last year, the most of any racial group, but it’s not moving quickly enough to do much to close the vast income gap between African Americans and other groups.
Not much reason to party.