Americans finally got a raise last year after eight years of stagnating incomes.
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In its annual report on income and poverty, the Census Bureau said Tuesday that the share of people in the USA living in poverty dropped to 13.5% in 2015, marking one of the biggest annual declines in decades.
Median household income in the United States rose last year for the first time in eight years, providing welcome relief for Americans struggling to make ends meet, USA officials said on Tuesday (Sept 13). Men saw a 1.5 percent increase in real median earnings, while women saw an increase of 2.7 percent.
In the almost five decades between 1967 and 2015, according to that table, real median household income peaked in 1999 at $57,909.
This year’s growth helps counterbalance the unequal growth of the post-recession years, but the wealthy are still capturing a large amount of USA income growth since the recession’s end.
Women working full-time saw a boost in earnings a year ago, with the median income rising 2.7 percent to $40,742.
Income rose in every region of the country, for every age group of household head, with statistically significant increases for nearly every racial group. That represents 3.5 million people who are no longer in poverty and is the largest annual percentage point drop since 1999, the Census Bureau says.
When medical expenses, defined as insurance premiums, co-pays, co-insurance, prescription drug costs and other uncovered medical costs are included, 11.2 million – or 3.5 percent – more people are defined as living in poverty in 2015 than the official statistics show. The unemployment rate fell from 6.2 percent to 5.3 percent previous year, and 2.4 million Americans found full-time, year-round jobs.
The data also suggests America’s poorest enjoyed the biggest gains, prompting economists to laud the report as one of the most positive in recent memory. The number of people without health insurance dropped from 33 million to 29 million.
Although the economy exited recession seven years ago and the stock market has been booming, millions of Americans appeared not to have been part of the recovery.
Income for the poorest 10 percent of households jumped 7.9 percent, while for the wealthiest 10 percent, incomes rose just 2.9 percent. “That probably means that annual earnings for the highest paid workers probably went up the most as well, and 2015 is going to be more unequal than 2014”.
According to an analysis by EPI, there are a few forces that shaped the strong household income growth of 2015 – the likes of which the country hasn’t seen in half a century. That narrowed the gap between the two groups by the largest amount on record. In the first and second quarter of this year, the economy grew at an annual rate of only 0.8 percent and 1.1. percent, according to the Bureau of Economic Analysis.
This report is important, and not just because it shows a long-awaited turnaround for middle-class Americans.
Enrollment through the state exchange increased in all areas, with 2.8 million people signing up for coverage through the end of 2016, the state Department of Health said Tuesday.
“Americans are also likely benefiting from an increase in middle-income jobs”. Numerous jobs created in the early years of the recovery were in low-paying sectors, such as fast food restaurants and retail.
The Census Bureau report, which also showed further improvements in health insurance coverage of Americans, was hailed by President Barack Obama and could provide a boost to Democratic presidential nominee Hillary Clinton, whose fortunes are closely linked with that of the president’s.
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Incomes also increased, and poverty declined, across all racial groups, with particularly large declines in the poverty rates among African-American and Hispanic households.
