Executive Briefings

U.S. Middle-Class Incomes Reached Highest-Ever Level in 2016

The incomes of middle-class Americans rose last year to the highest level ever recorded by the Census Bureau, as poverty declined and the scars of the past decade's Great Recession seemed to finally fade.

Median household income rose to $59,039 in 2016, a 3.2 percent increase from the previous year and the second consecutive year of healthy gains, the Census Bureau reported last week. The nation's poverty rate fell to 12.7 percent, returning nearly to what it was in 2007 before a financial crisis and deep recession walloped workers in ways that were still felt years later.

The new data, along with another census report showing the rate of Americans lacking health insurance to be at its lowest ever last year, suggest that Americans were actually in a position of increasing financial strength as President Trump, who tapped into anger about the economy, took office this year.

Yet the census report also points to the sources of deeper anxieties among American workers and underscores threats to continued economic progress.

Middle-class households are only now seeing their income eclipse 1999 levels.

Inequality remains high, with the top fifth of earners taking home more than half of all overall income, a record. And yawning racial disparities remain, with the median African American household earning only $39,490, compared with more than $65,000 for whites and over $81,000 for Asians.

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Median household income rose to $59,039 in 2016, a 3.2 percent increase from the previous year and the second consecutive year of healthy gains, the Census Bureau reported last week. The nation's poverty rate fell to 12.7 percent, returning nearly to what it was in 2007 before a financial crisis and deep recession walloped workers in ways that were still felt years later.

The new data, along with another census report showing the rate of Americans lacking health insurance to be at its lowest ever last year, suggest that Americans were actually in a position of increasing financial strength as President Trump, who tapped into anger about the economy, took office this year.

Yet the census report also points to the sources of deeper anxieties among American workers and underscores threats to continued economic progress.

Middle-class households are only now seeing their income eclipse 1999 levels.

Inequality remains high, with the top fifth of earners taking home more than half of all overall income, a record. And yawning racial disparities remain, with the median African American household earning only $39,490, compared with more than $65,000 for whites and over $81,000 for Asians.

Read Full Article