Times Square in New York, Photo: Chensiyuan/Wikimedia Commons
The middle class in America earned highest income in 2016, overtaking the previous record level achieved in 1999, according to the U.S. Census Bureau.
The Bureau released three reports on Tuesday, signaling a continued improvement in the economic health of the middle classs.
This year’s income and poverty report marks the 50th anniversary of the first poverty estimates released by the Census Bureau in the Current Population report series.
The real median household income increased by 3.2 percent between 2015 and 2016, while the official poverty rate decreased 0.8 percentage points, it said.
The Bureau said median household income in the United States in 2016 was $59,039, an increase in real terms of 3.2 percent from the 2015 median income of $57,230.
“This is the second consecutive annual increase in median household income.”
Quite importantly, the Bureau reports that at the same time the percentage of people without health insurance coverage decreased.
According to findings the median household income in stood at $59,039 in 2016, crossing the previous high of $58,655 chalked up in 1999.
The Census surveyed around 100,000 homes and the figures are adjusted for inflation.
The nation’s official poverty rate in 2016 was 12.7 percent, with 40.6 million people in poverty, 2.5 million fewer than in 2015. The 0.8 percentage point decrease from 2015 to 2016 represents the second consecutive annual decline in poverty.
The 2016 poverty rate is not statistically different from the 2007 rate (12.5 percent), the year before the most recent recession.
The percentage of people without health insurance coverage for the entire 2016 calendar year was 8.8 percent, down from 9.1 percent in 2015. The number of people without health insurance declined to 28.1 million from 29.0 million over the period.
The studies released by the Bureau include Income and Poverty in the United States: 2016 and Health Insurance Coverage in the United States: 2016.
Another Census Bureau report, The Supplemental Poverty Measure: 2016, was also released today. The supplemental poverty rate in 2016 was 13.9 percent, a decrease from 14.5 percent in 2015. With support from the Bureau of Labor Statistics, the Supplemental Poverty Measure shows a different way of measuring poverty in the United States and serves as an additional indicator of economic well-being. The Census Bureau has published poverty estimates using the supplemental poverty measure annually since 2011.
Here are some other detailed released by the Census Bureau:
Income
Real median incomes in 2016 for family households ($75,062) and nonfamily households ($35,761) increased 2.7 percent and 4.5 percent, respectively, from their 2015 medians. This is the second consecutive annual increase in median household income for both types of households. The differences between the 2015 to 2016 percentage changes in median income for family and nonfamily households was not statistically significant.
Race and Hispanic Origin
(Race data refer to people reporting a single race only; Hispanics can be of any race.)
The real median income of non-Hispanic white ($65,041), black ($39,490), and Hispanic ($47,675) households increased 2.0 percent, 5.7 percent, and 4.3 percent, respectively, between 2015 and 2016. This is the second annual increase in median household income for these households.
Among the race groups, Asian households had the highest median income in 2016 ($81,431). The 2015 to 2016 percentage change in their real median income was not statistically significant.
The differences between the 2015 to 2016 percentage changes in median income for non-Hispanic white, black, Hispanic, and Asian households were not statistically significant.
Regions
Households in the South and West experienced an increase in real median income of 3.9 percent and 3.3 percent, respectively, between 2015 and 2016. The changes in incomes of households in the Northeast and Midwest were not statistically significant.
Households with the highest median household incomes were in the Northeast ($64,390) and the West ($64,275), followed by the Midwest ($58,305) and the South ($53,861). The difference between the median household incomes for the Northeast and West was not statistically significant.
The difference between the 2015 to 2016 percentage changes in median income for households in all regions were not statistically significant.
Earnings
The 2016 real median earnings of men ($51,640) and women ($41,554) who worked full- time, year-round were not statistically different from their respective 2015 medians.
The female-to-male earnings ratio was 0.805, an increase of 1.1 percent from the 2015 ratio of 0.796. This is the first time the female-to-male earnings ratio has experienced an annual increase since 2007.
Between 2015 and 2016, the total number of people with earnings increased by about 1.2 million. In addition, the total number of full-time, year-round workers increased by 2.2 million between 2015 and 2016, suggesting a shift from part-year, part-time work status to full-time, year-round work status. The difference between the 2015 to 2016 increases in the number of men and women full-time, year-round workers was not statistically significant.
An estimated 74.8 percent of working men with earnings and 62.2 percent of working women with earnings worked full-time, year-round in 2016; both percentages were higher than the 2015 estimates of 73.9 percent and 61.3 percent, respectively.
Income Inequality
The Gini index was 0.481 in 2016; the change from 2015 was not statistically significant. Developed more than a century ago, the Gini index is the most common measure of household income inequality used by economists, with 0.0 representing total income equality and 1.0 equivalent to total inequality.
The share of aggregate household income in the fourth quintile decreased 1.3 percent between 2015 and 2016, while changes in the shares of other quintiles were not statistically significant.
Poverty
The poverty rate for families in 2016 was 9.8 percent, representing 8.1 million families, a decline from 10.4 percent and 8.6 million families in 2015.
For most demographic groups, the number of people in poverty decreased from 2015. Adults age 65 and older were the only major population group to see an increase in the number of people in poverty.
Thresholds
As defined by the Office of Management and Budget and updated for inflation using the Consumer Price Index, the weighted average poverty threshold for a family of four in 2016 was $24,563. (See <www.census.gov/data/tables/time-series/demo/income-poverty/historical-poverty-thresholds.html> for the complete set of dollar value thresholds that vary by family size and composition.)
Sex
In 2016, 11.3 percent of males were in poverty, down from 12.2 percent in 2015. About 14.0 percent of females were in poverty in 2016, down from 14.8 percent in 2015.
Gender differences in poverty rates were more pronounced for those ages 18 to 64. The poverty rate for women ages 18 to 64 was 13.4 percent, while the poverty rate for men ages 18 to 64 was 9.7 percent. The poverty rate for women age 65 and older was 10.6 percent, while the poverty rate for men age 65 and older was 7.6 percent.
Race and Hispanic Origin
(Race data refer to people reporting a single race only; Hispanics can be of any race.)
The poverty rate for non-Hispanic whites was 8.8 percent in 2016 with 17.3 million individuals in poverty. Neither the poverty rate nor the number in poverty was statistically different from 2015. Non-Hispanic whites accounted for 61.0 percent of the total population and 42.5 percent of the people in poverty.
The poverty rate for blacks decreased to 22.0 percent in 2016, from 24.1 percent in 2015. The number of blacks in poverty decreased to 9.2 million, down from 10.0 million.
The poverty rate for Hispanics decreased to 19.4 percent in 2016, down from 21.4 percent in 2015. The number of Hispanics in poverty decreased to 11.1 million, down from 12.1 million.
Asians did not experience a statistically significant change in their poverty rates nor in the number of people in poverty between 2015 and 2016.
Age
In 2016, 18.0 percent of children under age 18 (13.3 million) were in poverty, down from 19.7 percent and 14.5 million in 2015. Children represented 23.0 percent of the total population and 32.6 percent of the people in poverty.
In 2016, 11.6 percent of people ages 18 to 64 (22.8 million) were in poverty, down from 12.4 percent and 24.4 million in 2015.
In 2016, 9.3 percent of people age 65 and older were in poverty, statistically unchanged from 2015. The number in poverty increased from 4.2 million to 4.6 million between 2015 and 2016.
Regions
In 2016, the poverty rate and the number in poverty decreased in the Northeast from 12.4 percent (6.9 million) in 2015 to 10.8 percent (6.0 million) and in the South from 15.3 percent (18.3 million) in 2015 to 14.1 percent (17.0 million). The Midwest and West did not experience a significant change in the poverty rate or the number in poverty between 2015 and 2016.
Shared Households
Shared households are defined as households that include at least one “additional” adult, a person age 18 or older, who is not the householder, spouse or cohabiting partner of the householder. Adults ages 18 to 24 who are enrolled in school are not counted as additional adults.
In 2017, the number and percentage of shared households remained higher than in 2007, the year before the most recent recession. In 2007, 17.0 percent of all households were shared households, totaling 19.7 million households. In 2017, 19.4 percent of all households were shared households, totaling 24.6 million households.
Of young adults ages 25 to 34, 16.1 percent (7.1 million) lived with their parents in 2017, neither estimate was statistically different from 2016.
Supplemental Poverty Measure
The supplemental poverty measure extends the official poverty measure by taking into account many of the government programs designed to assist low-income families and individuals that are not included in the current official poverty measure.
The supplemental poverty measure released today shows:
The supplemental poverty rate decreased 0.6 percentage points in 2016 to 13.9 percent, from 14.5 percent in 2015.
The supplemental poverty rate for 2016 was 1.2 percentage points higher than the official poverty rate of 12.7 percent.
There were 44.6 million people in poverty in 2016 using the supplemental poverty measure (13.9 percent), higher than the 40.7 million (12.7 percent) using the official poverty definition with the supplemental poverty measure universe.
While the supplemental poverty rate declined for many groups, individuals age 65 and over experienced a statistically significant increase, from 13.7 percent in 2015 to 14.5 percent in 2016.
When tax credits and noncash benefits results are included, this results in lower poverty rates for some groups. For instance, the supplemental poverty rate was lower for children than the official rate: 15.1 percent compared with 18.0 percent.
While the official poverty measure includes only pretax money income, the supplemental poverty measure adds the value of in-kind benefits, such as the Supplemental Nutrition Assistance Program, school lunches, housing assistance and refundable tax credits.
Additionally, the supplemental poverty measure deducts necessary expenses for critical goods and services from income. Expenses that are deducted include: taxes, child care, commuting expenses, contributions toward the cost of medical care and health insurance premiums and child support paid to another household. The supplemental poverty measure permits the examination of the effects of government transfers on poverty estimates. For example, not including refundable tax credits (the Earned Income Tax Credit and the refundable portion of the child tax credit) in resources, the poverty rate for all people would have been 16.5 percent rather than 13.9 percent. The supplemental poverty measure does not replace the official poverty measure and will not be used to determine eligibility for government programs.
Health Insurance Coverage
The Current Population Survey shows that the percentage of people with health insurance coverage for all or part of 2016 was 91.2 percent, 0.3 percentage points higher than the rate in 2015 (90.9 percent). Over time, changes in the rate of health insurance coverage and the distribution of coverage types may reflect economic trends, shifts in the demographic composition of the population, and policy changes that affect access to health care. Several such policy changes occurred in 2014 when many provisions of the Patient Protection and Affordable Care Act went into effect.
In 2016, private health insurance coverage continued to be more prevalent than government coverage, at 67.5 percent and 37.3 percent, respectively. Neither the private coverage rate nor government coverage rate had a statistically significant change from 2015.
Of the subtypes of health insurance coverage, employer-based insurance covered 55.7 percent of the population for some or all of the calendar year, followed by Medicaid (19.4 percent), Medicare (16.7 percent), direct-purchase (16.2 percent) and military coverage (4.6 percent).
Medicare was the only subtype of health insurance that experienced a statistically significant change between 2015 and 2016. The rate of Medicare coverage increased by 0.4 percentage points, from 16.3 percent in 2015 to 16.7 percent in 2016. This increase was likely due to growth in the number of people age 65 and over and not to changes in Medicare coverage rates within any particular age group.
Age
According to the American Community Survey, between 2015 and 2016, the percentage of people without health insurance coverage dropped for most ages under 65, with generally larger decreases for working-age adults (ages 19 to 64).
Race and Hispanic Origin
(Race data refer to people reporting a single race only; Hispanics can be of any race.)
In 2016, non-Hispanic whites had the lowest uninsured rate among race and Hispanic origin groups at 6.3 percent. The uninsured rates for blacks and Asians were 10.5 percent and 7.6 percent, respectively. Hispanics had the highest uninsured rate at 16.0 percent.
According to the American Community Survey, in 2016, the state with the lowest percentage of people without health insurance at the time of the interview was Massachusetts (2.5 percent), while the highest uninsured rate was in Texas (16.6 percent).
The American Community Survey also showed that between 2015 and 2016, the uninsured rate decreased in 39 states. The declines for the states ranged from 0.3 percentage points (Massachusetts) to 3.5 percentage points (Montana). Eleven states and the District of Columbia did not have a statistically significant change in their uninsured rate.
States
According to the American Community Survey, in 2016, the state with the lowest percentage of people without health insurance at the time of the interview was Massachusetts (2.5 percent), while the highest uninsured rate was in Texas (16.6 percent).
The American Community Survey also showed that between 2015 and 2016, the uninsured rate decreased in 39 states. The declines for the states ranged from 0.3 percentage points (Massachusetts) to 3.5 percentage points (Montana). Eleven states and the District of Columbia did not have a statistically significant change in their uninsured rate.
