The Good News
The real median household income for Americans increased 5.2 percent to $56,516 in 2015, the U.S. Census Bureau reported Tuesday. This marks the first annual rise in household income since pre-recession 2007.
Rising incomes led to a significant drop in household poverty rate as well — a decline of 1.2 percent, or 3.5 million fewer Americans. This is the largest annual percentage point drop in poverty since 1999. (The income threshold for poverty is $28,995 in annual income for a family of 5.) Today, roughly 43.1 million people live in poverty.
Don’t start celebrating yet. Progress has been made, but the real median household income is still about 1.6 percent away from catching up with its 2007 levels and even farther — about 2.4 percent —from its 1999 peak.
But Not All Groups Are Doing Well
Income inequality. Income inequality remained stubbornly stagnant in 2015. The Census Bureau measures income inequality on a scale of 0 to 1 (1 meaning perfect income equality) to measure the extent to which income is distributed among the population. In 2015, the U.S. scored a 0.479, showing no significant over the year prior.
The gender wage gap. Women continue to earn about 80 cents to every $1 a man earns, however the real median earnings for women increased 2.7 percent compared to a 1.5 percent rise for men compared to a year ago.
Asian-American households. Of all race groups, Asian households had the highest median income in 2015 at $77,166, although the group experienced no significant change in income.
Non-Hispanic whites see significant income growth. Real median income of non-Hispanic Whites rose 4.4 percent to $62,950. African-American households saw median incomes rise 4.1% to an average of $36,898. This is the first rise in income for non-Hispanic Black and White households since 2007. Hispanic-origin incomes rose 6.1 percent to $45,148, the first annual increase since 2013.
Noncitizen income rises sharply. The median income of households maintained by a noncitizen rose the most — by 10.5 percent — although it’s the lowest amount by nativity at $45,137. The real median income of households managed by foreign-born people rose 5.3 percent to $54.295, while that of households maintained by a native-born person rose 4.4 percent to $57,173. Naturalized citizens didn’t see a significant change in household income at $61,982.
Why You May Not Feel Any Richer
It may be hard to hear the jingle of extra cash in your pocket. Public policy think tank American Enterprise Institute reports the consumer price index — the average measure of consumer prices — jumped about 55% since 1996. The largest increases were in big ticket items: housing, food, medical care, childcare, but you may feel the rise even more if you’re in school.
The average price of college tuition and textbooks rose the most — by a staggering 197% and 207% respectively. Next to that, a 5.2% bump in median income over the past year is meager.
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