Median Household Income Drops 3.6% in 2008
We've had some pretty severe recessions in the United States since the end of WWII - the recession in the early 80s was a particularly nasty one, with the unemployment rate spiking over 10%.
However, according to USA Today, median household income has never dropped as much (in inflation adjusted dollars) as it did in 2008, and things are expected to be even worse this year.
According to the Census Bureau, median household income in the United States fell to $50,303 in 2008, a drop of 3.6%.
This is the biggest drop seen since the government started keeping records of such things in 1947.
Things are projected to get even worse in 2009, with some experts (such as Sheldon Danzinger of the Population Studies Center at the University of Michigan) expecting that household median income will drop as much as 5% in 2009.
Some other data points from the Census Bureau report:
-real median income for families fell 3.3%, while non-family households experienced a drop of 4.0%
-total drop in median income between 1978 and 1983 was 6.0%.. 2007-09 should easily top this mark
-men earned an average of $46,367 in 2008, while women earned $35,745.
-female-to-male earnings ratio was 0.77 in 2008
-poverty rate in 2008 was 13.2%, up from 12.5% the year before
-a total of 39.8 million people were considered to be living in poverty last year
Now, the drop in median household income certainly isn't surprising - afterall, we are currently slogging our way through a nasty recession, and jobless numbers have been spiking over the last year and a half.
However, the severity of the drop in income, especially when compared to the recessions of the early '80s, should certainly raise some eyebrows. With the unemployment rate in the United States expected to top 10% in early 2010, you have to wonder how much income will be down throughout the course of the entire recession.
Any hope that the government had of increased consumer spending helping to lead us out of the recession is looking pretty farfetched at this point.
Not only is household income way down, but there has also been a severe cutback in access to credit for the average American.
Not only can people no longer afford to buy things, but they can't even borrow money to pay for it.
Sources: USA Today - Census: Income fell sharply last year
U.S. Census Bureau
Filed under: The Economic Meltdown
6 COMMENTS - What Say You?
Comment by Mike G Harper on October 26, 2010 @ 5:14 pm
I feel $50,303 was a little high for 2008 and would sure be interested to see what the Census
Bureau median household income in the United States was for 2009 and especially 2010 due to the unemployment rate being around 10% nationally.
I feel President Obama is going to have a little problem finding nearly 15 million unemployed people jobs. Our best bet would be the "Rapture" or the Battle of Armageddon, and soon.
Comment by Charity Oldaker on February 05, 2011 @ 8:24 am
I have to agree with Mr. Harpers assessment. Men cannot fix all the woes of the world, only God's government can truely bring about real change. I'm not a bible pusher but I have to say we need help that can only come from above. I am an educated woman and I feel like there is no longer an edge in this marketplace. Even educated people suffer.
Comment by CHRISTIANJUNTO@GMAIL.COM on February 22, 2011 @ 9:01 am
THE GREAT PROBLEM WE AS A NATION FACE IS OUR OWN GREED AND SELFISHNESS. THE RICH DON'T WANT TO PAY TAXES, THEY DON'T WANT TO SERVE IN THE ARMED FORCES, THE OTHERS OF US ARE SIMILARLY ONLY CONCERNED ABOUT OUR OWN NEEDS AND WANTS.
THERE IS LITTLE OR NO THOUGHT GIVEN TO THE GOOD OF THE NATION OR EVEN OUR LOCAL COMMUNITIES. THE LONG TERM IMPACT OF SUCH MIND SETS IS WHAT WE NOW HAVE, GOVERNMENT THAT DOES NOT WORK, CORRUPTION AT ALL LEVEL OF GOVERNMENT AND BUSINESS, AND A TOTAL LOSS OF THOSE VALUES UPON WHICH OUR NATION WAS FOUNDED AND BUILT.
Comment by Just Sayin' on May 23, 2011 @ 10:32 am
Maybe you should look into "higher education" too.
Comment by Wayne on May 23, 2011 @ 3:27 pm
I do not think that we need fewer educated people as a viable solution to our socio-economic problems. We could use a few more economists, a few more accountants, less lawyers, less wall street traders and more business people who are actually focused on business with less focus on making money. Business isn't just about money, but it seems (if there is a fault with our educational systems it is this) that we have forgotten the meaning of the word Value, and values as well.
Perhaps Wall Street should have learned (by now) that hiring NASA to create more complex trading models is not the right solution...afterall rockets go up very fast and fall back to earth just as fast...
Comment by dave on June 26, 2011 @ 3:40 pm
I do beleive that education is always needed as there is always room for improvement,however the statement about wallstreet is on the money. the greed is overwhelming and for those who have done well in stock forget that there must be excess profit for stock to work,wich translates into job loss.as when the investors get over abundent corperate will do anything to keep investers in as moving jobs oversees,lowering wages,cutting benifets.a very nasty cycle. also with the bailouts that were supposed to help home owners turned out to be nothing more than a con at our expense as the people that were in trouble that was supposably helped no longer had (quote) perfect credit and the forclosers soared . throw out the greed and start helping our own.break up the monoply in corporations and watch the economy grow.
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