Household income growth was slower and less widespread in 2018 than in 2017

By David Cooper and Julia Wolfe

The state income data from the American Community Survey (ACS), released this morning by the Census Bureau, showed that in 2018, household incomes across the country rose—albeit more slowly, and in fewer states, than in the previous year. From 2017 to 2018, inflation-adjusted median household incomes grew in 33 states and the District of Columbia (14 of these changes were statistically significant.) This marks a decline from the broader growth seen between 2016 and 2017 when median household incomes grew in 40 states and the District of Columbia, with 24 of those changes being statistically significant.

The ACS data showed an increase of 0.2% in the inflation-adjusted median household income for the country as a whole—an increase of just $130 for a typical U.S. household and a slowdown in growth compared to the past three years: household incomes increased by 3.8% in 2015, 2.0% in 2016, and 2.5% in 2017. [i] Despite these increases, households in 23 states still had inflation-adjusted median incomes in 2018 below their 2007 pre-recession values, which makes this year’s slowdown particularly disappointing.

From 2017 to 2018, the largest percentage gains in household income occurred in Idaho, where the typical household experienced an increase of $2,085 in their annual income—an increase of 3.9%. Maryland remains the state with the highest median household income at $83,242, having experienced a slight increase (0.6%) from 2017 to 2018. The District of Columbia has the highest median household income in the country at $85,203—though comparing D.C. to states is problematic, since D.C. is a city, not a state. 

From 2017 to 2018, there were 17 states in which the median household income declined or was unchanged: Alaska (-0.8%), Iowa (-0.1%), Maine (-3.6%), Missouri (-0.7%), Nebraska (-3.0%), Nevada (-1.3%), New Hampshire (-0.2%), New Jersey (-0.4%), New Mexico (-1.5%), North Carolina (-0.3%), South Dakota (-2.8%), Rhode Island (-1.7%), Tennessee (-0.4%), Virginia (-1.0%), West Virginia (-1.0%), and Wyoming (-0.5%). Only one of these—Maine, where incomes declined by 3.6% after increasing by 3.8% in 2017—had a statistically significant drop. 31 states and the District of Columbia saw either a slowdown in their growth compared to last year, or experienced even steeper declines, reflecting the disappointing growth seen at the national level.

The 0.2% increase in median household incomes reported in the ACS is an even weaker increase than the 0.9% that the Census Bureau reported earlier this month in their annual release of data from the Current Population Survey (CPS). It is not unusual for the two surveys to show slightly different values, although the weakness in growth reported in both surveys affirms that household income growth for middle-income households is slowing.[ii] This slowdown in growth not only affects middle-class households who, in many states, still have not recovered to their pre-recession income levels, but it also stalls progress in lifting the lowest-income families out of poverty.


[i] The ACS and CPS have different samples and cover slightly different timeframes, which can explain why the two surveys will differ. The CPS surveys all of its respondents in March of each year, and asks them to describe their income in the preceding calendar year. The ACS is a rolling 12-month survey—i.e., households are surveyed on an ongoing basis throughout the year and when surveyed, respondents are asked to report their income over the preceding 12 months. Thus, a significant portion of 2018 ACS respondents (those surveyed in the first half of 2018) were describing income mostly from 2017. Similarly, the 2017 ACS partially describes income in 2016. Therefore, the change in ACS incomes from 2017 to 2018 is describing changes occurring over a somewhat broader period that includes portions of 2016.


[ii] The increase we calculate from 2017 to 2018 is smaller than the 0.8 percent growth reported by the Census Bureau because they inflation-adjust the underlying microdata to calculate the real median household income for 2017. Because we do not have access to the microdata, we inflation-adjust the published 2017 median and all previous years’ medians. We do not use their measure of real median household incomes since it is only available back to 2014.

***

Reposted from EPI

Posted In: Allied Approaches

Union Matters

Steel for Wind Power

From the USW

From tumbledown bridges to decrepit roads and failing water systems, crumbling infrastructure undermines America’s safety and prosperity. In coming weeks, Union Matters will delve into this neglect and the urgent need for a rebuilding campaign that creates jobs, fuels economic growth and revitalizes communities. 

Siemens Gamesa last month laid off 130 workers at its turbine blade manufacturing plant in Iowa, just months after GE Renewable Energy decided to close an Arkansas factory and eliminate 470 jobs.

The companies reported shrinking demand for their products, even though U.S. consumption of wind energy increases every year.

America’s prosperity depends not only on harnessing this crucial energy source but also ensuring that highly skilled U.S. workers build the components with the cleanest technology available.

Right now, the nation relies on imported steel and turbine components from foreign manufacturers like China while America’s own steel industry—well equipped for this production—struggles because of dumping and other unfair trade practices.

Steel makes up the bulk of turbine hubs and the wind towers themselves. It’s also used to make the cranes and platforms necessary for installing the towers.

Yet the potential boon to America’s steel industry is just one reason to ramp up domestic production of wind energy infrastructure.

American steel production ranks among the cleanest in the world, while China has the highest carbon emissions of any steelmaking nation and flouts environmental regulations.

The nation’s highly-skilled steelmaking workforce must play an essential role in the deeply-needed revitalization and modernization of the nation’s failing infrastructure. Producing the components for harnessing wind energy domestically and cleanly is an important step that will put Americans to work and position the United States to be world leaders in this growing industry.

 

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There is Dignity in All Work

There is Dignity in All Work