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Recovery? Household Income Continues Post-Recession Decline

Recovery? Household Income Continues Post-Recession Decline

“People are trying to build their human capital and improve their skills to compete in this tough labor market.”

WASHINGTON (TheBlaze/AP) -- The average American household is earning less than when the Great Recession ended four years ago, according to a report released Wednesday.

U.S. median household income, once adjusted for inflation, has fallen 4.4 percent in that time, according to the report from Sentier Research.

The report is based on an analysis of Census Bureau data.

Median income, which is used to measure the health of the middle-class, has fallen by roughly 7.2 percent since January 2000, the report notes.

“Median income is affected by trends in inequality, and you are seeing that to the extent there has been income growth in the past decade, it has disproportionately gone to those at the top and very top,” Gregory Acs, director of the Income and Benefits Policy Center at the Urban Institute, a research organization, said in a recent Washington Post report.

The median, or midpoint, income in June 2013 was $52,098. That's down from $54,478 in June 2009, when the recession officially ended. And it's below the $55,480 that the median household took in when the recession began in December 2007.

Between June 2009 and June 2013, median income has declined even as the number of people with college degrees has increased.

The number of households headed by persons with an associate degree rose 14.7 percent, the report notes. Meanwhile, the number households headed by persona with a bachelor’s degree increased by 10.1 percent.

These figures, and the fact that the number of households headed by people without degrees has declined, reflect two likely facts, the WaPo notes:

  • Americans, particularly those without college degrees, have been slow to move out and establish households in the wake of the downturn.
  • Many Americans are working to bolster their credentials to help them navigate a labor market that has seen a pronounced decline in well-paying “mid-skill” jobs.

“People are trying to build their human capital and improve their skills to compete in this tough labor market,” said Gordon W. Green, co-author of the report and a partner at Sentier.

The report says nearly every group is worse off than four years ago, except for those 65 to 74. Some groups have experienced larger-than-average declines, including blacks, young and upper-middle-aged people and the unemployed.


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Featured image Getty Images.



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