U.S. median income rises for 2nd year in a row
The median household earned more money in 2016 than ever before, according to new Census Bureau data. The typical family earned $59,039, up 3.2% compared to 2015 and beating the previous all-time high of $58,149 from 1999. (Census Bureau officials, however, warned that the the 2016 number isn't directly comparable to estimates from before 2014, when its survey was modified to capture more sources of income.)
Data: U.S. Census Bureau; Chart: Lazaro Gamio / Axios
Why it's good news: 2016 was the second straight year for wage increases as a strong job market has raised wages for some and provided new jobs for the previously unemployed.
Why it's not so good news: Even if median income is at an all-time high, it's not very much higher than it was twenty years ago. As University of Michigan economist Justin Wolfers writes this morning on Twitter, "The most amazing fact remains that Real Median Household income in 2016 is barely above that in 1999."
Point is, for the American middle class, it hasn't just been a lost decade. It's pretty much a lost two decades. An urgent economic crisis. — Justin Wolfers (@JustinWolfers) September 12, 2017
Is it really a crisis? Not every economist would characterize the situation in such dire terms. The American Enterprise Institute's Mark Perry has pointed out that because household sizes have been declining over the years, median income per person has been rising at a faster rate than median household income. Another factor holding down income growth is the retirement of baby boomers — causing a wave of high earners to leave the labor market only to be replaced by younger folks not making as much.