U.S. Incomes Fail to Grow for Second Year in a Row, Census Figures Show

Households facing highest inflation in decades recorded median 2021 income of $70,800

By Paul Overberg and John McCormick of The WSJ. Excerpts:

"Americans as a whole have experienced two years in a row of flat or declining household income, new government data showed Tuesday, reflecting the pandemic’s lingering economic pain as inflation is also taking the largest bite out of pocketbooks in four decades.

In its annual assessment of the nation’s financial well-being, the Census Bureau said median household income of about $70,800 in 2021 wasn’t different in a statistically significant way from the inflation-adjusted 2020 estimate of about $71,200. 

The lack of any real growth for 2021 follows a decrease in incomes recorded in 2020, the first year of the pandemic. Totals in 2020 and 2021 were boosted by significant government spending in response to the pandemic that helped reduce poverty."

"The bureau said the official poverty rate in 2021 was 11.6%, or about 37.9 million people living in poverty. Neither the rate nor the total was statistically different from 2020. For a four-person household, the threshold for meeting the definition of poverty was about $27,740 in 2021.

The official poverty measure doesn’t reflect how much a household pays in taxes, and it also omits noncash government aid such as tax credits, housing subsidies and free school lunches. A broader measure that accounts for such expenses and aid fell last year to 7.8%, a drop of 1.4 percentage points from 2020. The rate was the lowest since the measure was introduced in 2009.

The unofficial poverty rate also fell sharply for children, dropping to 5.2% from 9.7%, reflecting the effect of an expanded child tax credit. Various tax credits lifted 9.6 million people of all ages above the poverty line last year"

"One group that saw a slight uptick in poverty was those 65 and older."

 

See Historical Income Tables: Families from the Census Bureau. They also have a link for Gini coefficients for family income going back to 1947. See also Historical Income Tables: Households. See also Historical Poverty Tables: People and Families - 1959 to 2021. These Census Bureau links will take you to tables on poverty, incomes and inequality (the Gini coefficient measures inequality).