Market Overview

U.S. Household Incomes Rise For First Time In Nearly 10 Years

U.S. Household Incomes Rise For First Time In Nearly 10 Years

U.S. household incomes had not risen since 2007. However, 2015 saw growth not only return, but also hit its highest rate since the Census Bureau first started releasing this data in 1967.

Over last year, the typical U.S. family’s inflation-adjusted median income surged by 5.2 percent. After adjusting for inflation, the median household income reached $56,500 in 2015, the Census Bureau said Tuesday.

At this level, household incomes stand only 1.6 percent below the 2007 pre-recession point and 2.4 percent under the all-time high recorded in the last year of last millennium, the Wall Street Journal reported.

Related Link: Delivering Alpha 2016: Everything You Need To Know

“The latest figures show how several years of robust growth in employment are finally helping a broad swath of the nation regain ground lost after several years of either flat incomes or sustained declines, particularly for lower-income households,” the note continued. In fact, the bottom fifth of all earners were the most benefited by the recent increase.

One thing to notice, however, was that while income gains reached almost all age, ethnic and racial groups, as well as most regions, it did not impact those living outside of the country’s metropolitan areas.

Poverty also fell over 2015, from 14.8 percent in 2014 to 13.5 percent last year, the Census Bureau’s report added. This also represented the largest drop since 1968.

“We’re climbing out of a deep hole. We definitely can see the top, and we’ll get there next year even with normal growth,” Lawrence Mishel, president of the Economic Policy Institute think tank, said.

Narrowing The Wage Gaps

The gender wage gap is finally narrowing, the Census Bureau’s report showed as well. Full-time, year-round working women saw their salaries increase by 2.7 percent last year, while men only witnessed a 1.5 percent spike.

Related Link: The Gender Wage Gap: What It Means, Why It Matters And What's Changing

Non-citizens were also big beneficiaries last year, with their wages rising 10.5 percent, versus native-born households’ 4.4 percent. Still, non-native households make a median wage of $45,100 per year, versus citizens’ $57,200 per year.

The report also suggested the Affordable Care Act (a.k.a. "Obamacare") might be baring some fruit, as the number of people lacking health insurance fell from 10.4 percent in 2014, to 9.1 percent in 2015. However, the note also pointed out that most of the decrease was driven by people acquiring private insurance plans and not government ones.

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Disclosure: Javier Hasse holds no interest in any of the securities or entities mentioned above.

Posted-In: Census Bureau economic policy instituteNews Econ #s Top Stories Economics Media General Best of Benzinga


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