In addition to the sharp rise in poverty, the Census Bureau also reported that income fell sharply for most us us:
The inflation-adjusted income of the median household—smack in the middle of the populace—fell 4.8% between 2000 and 2009, even worse than the 1970s, when median income rose 1.9% despite high unemployment and inflation. Between 2007 and 2009, incomes fell 4.2%.
The bureau said that the drop in income in the recent recession, so far, wasn’t much different from those recorded in the early 1990s and early 2000s recessions, and was actually smaller than the 6% drop recorded in the deep recession of the early 1980s.
But there is a difference this time: In the prior three recessions, incomes fell after years of upswing, then resumed growing once the downturn ended. The decline this time comes on top of a long period in which incomes stagnated even through the recovery of 2003 to 2007.
The decline in incomes cuts across age, race and class, with some exceptions. Hispanics and Asians saw small increases in their median incomes.
The recession has been particularly hard on young workers and young families, in part because they aren’t eligible for as many government benefits as older workers. Younger workers have a harder time qualifying for unemployment benefits because they have a shorter work history.
That has prompted many young adults to move in with family, or put off leaving home in the first place. The number of 25-to-34-year-olds living with their parents rose 8.4% to 5.5 million in 2010 from 2008. Within that age group, 42.8% fell below the poverty threshold—$11,161 for an individual.
Of course, not all Americans suffered the same. Those at the top did relatively better than the rest of us, increasing our record inequality even further:
The Census snapshot indicated that the gap between the best-off and worst-off Americans widened a bit more in 2009, a long-standing trend, but not by much. The top fifth of households accounted for 50.3% of all pre-tax income; the bottom two-fifths got 12%. In 1999, the top fifth claimed 49.4% and the bottom got 12.5% of the income.
September 17th, 2010