The US economy added 2m jobs in the past year while major stock indexes hit record levels in response to robust corporate profits. Nevertheless, the inflation-adjusted (real) income for the typical American household did not rise in 2012 and poverty failed to fall, new data from the Census Bureau show. The level of income is below what it was in 1989.
The census report found that median household income (mid-way level where half are above and half below), adjusted for inflation, was $51,017 in 2012, down about 9% from an inflation-adjusted peak of $56,080 in 1999.
In 1989, the median American household made $51,681 in 2012 dollars compared with the 2012 level of $51,017 -- so 24 years ago, a middle class American family was making more than such a family was earning last year.
In the period 1989, the US population grew 27% to 313m while real GDP (gross domestic product) per capita) expanded by over 70% - - see chart below.
So after population growth, there was a significant rise in national output per capita in the period 1989-2012.
The nation's official poverty rate in 2012 was 15.0%, which represents 46.5m people living at or below the poverty line. This marked the second consecutive year that neither the official poverty rate nor the number of people in poverty were statistically different from the previous year's estimates. The 2012 poverty rate was 2.5 percentage points higher than in 2007, the year before the economic downturn.
The poverty threshold in 2012 was an income of
$23,492 for a family of four.
Census Bureau report [pdf]
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