- by New Deal democrat
Real life intrudes, so I can't do a detailed analysis now, but this morning the Census Burreau came out with their annual update on median household income for 2014.
The headline is that real median household income for all households decreased by -1.5% in 2014. But the number of people aged 35 - 54 decreased by about 150,000, while the number of households with people over 65 grew by about 900,000. Since median income for "over 65" households was only about $39,000, while prime working age median income was about $66,000, that significantly distorts the overall number.
Here are the numbers for the 3 prime age working decades:
25- 34 +1.8%
35-44 -2.9%
45-54 -1.3%
That is still a slight overall decline.
As I anticipated, the numbers are the year-long average, not year-end to year-end. Thus, for example, the calculated inflation rate was +1.5%, even though at year end 2014 the CPI was only up about +0.6% YoY.
Interestingly, a decline in real incomes for men working full time was more than the increase in real median income for women working full time:
I'll have more later once I am able to take a more detailed look. Overall this certainly looks like a disappointment.
UPDATE: According to Reuters:
Edward Welniak, chief of income statistics for the Census Bureau's housing and household economic branch, attributed the leveling of median income in part to a 1.2 million increase last year in non-family households, which typically have much lower income than family households.
"What we see there then is this increase in households at the lower end of the income distribution tended to hold down median household income," he told reporters.
Interesting.
UPDATE 2: Following up onthe Reuters article, I went back and, sure enough, real median income of al family households increased across the board. Nonfamily households, specifically those consisting of a man, are responsible for the entire decline:
I have no diea what is behind this anomalous increase in sincgle male householdss. My first guess would be young men moving out on their own, but age group 25-34 was one of the few to show an actual increas in income. Perhaps an increase in younger (i.e., under 25 men moving out of the basement?
Another important breakdown is income across the board including part-timers, vs. income of full-timers only. The median wage for male full-timers actually fell slightly, while that of full-time women workers rose slightly -- but not enough to overcome the deficit by men.
Even more interestingly, despite that, the real median income for all workers including part-timers rose:
In other words, the rise in incomes among wage-earners in 2014 is not being driven by raises, but rather by the conversion of part-timers to full-time work, and/or by the increase in hours worked by part-timers. This is important information. It explains why median weekly income has been flat to declining, while median hourly income has been increasing.
