Middle-class income rose above $61,000 for the first time last year, U.S. Census Bureau says
Middle-class income rose to the highest recorded levels in 2017 and the national poverty rate declined as the benefits of the strong economy lifted the fortunes of more Americans, the U.S. Census reported Wednesday.
The median U.S. household earned $61,372 last year, meaning half of the families in the country brought in more income than this and half earned less.
Crossing the $61,000 mark signals the American middle-class may have finally earned more than it did in 1999, although the Census Bureau cautions that median income last year was not statistically different from 1999 or 2007, the last year before the recession. A change in methodology in 2013 makes precise comparisons difficult. All the income figures have been adjusted for inflation and are reported in 2017 dollars.
Middle-class household income has been rising steadily for the past several years as the economy has rebounded from the deep recession and millions of Americans have found jobs again. The extra pay from having another person in the home employed again or working additional hours is the largest factor contributing to rising income, the Census Bureau said.
"We’re continuing to see a shift from part-time to full-time work, so some of that could explain an increase in income,” said Trudi Renwick, an assistant division chief at Census Bureau.
The Census Bureau also reported that the U.S. poverty rate declined modestly to 12.3 percent, the lowest level in more than a decade and a sign the economic devastation from the Great Recession is subsiding.
But by other measures, the economy is still not working as well as it could for everyone. Inequality remains near the highest levels in the modern era, according to various metrics the Census Bureau tracks, and the share of Americans without health insurance stalled last year after several years of progress to extend coverage to more people under the Affordable Care Act.
The percentage of Americans without health insurance was essentially unchanged from 2016 to 2017 — staying at about 8.8 percent, or 28.5 million people — despite the overall economic boom. That marks a leveling off in the decline in the number of Americans without insurance — a number that trended steadily downward from 2010 to 2016, in part due to the implementation of the Affordable Care Act.
What it will take for more Americans to get ahead is higher hourly wages, said Jared Bernstein, former chief economist to vice president Joe Biden and a senior fellow at the left-leaning Center on Budget and Policy Priorities.
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