Northwest Arkansas Democrat-Gazette
Poverty at 60-year low beore virus hit
Census: ’19 median income up 6.8%
Income was surging for U.S. households while the national poverty rate fell in 2019, indicating the finances of many Americans were improving before the covid-19 pandemic upended the U.S. economy and threw millions out of work.
Median, inflation-adjusted household income increased 6.8% last year to $68,703 — among the fastest gains on record — as more Americans got jobs and wages rose, according to annual data released Tuesday by the U.S. Census Bureau. The poverty rate fell by 1.3 percentage point to 10.5%, the lowest in data back to 1959 and the fifth straight decline.
The data helps flesh out the picture of American families’ economic health during times when the jobless rate hovered near a half-century low of 3.5%. Since then, the pandemic put tens of millions out of work and exacerbated existing inequalities, with lower-wage workers at places such as hotels and restaurants facing the brunt of job losses.
The government’s stimulus checks and extra $600 a week in jobless benefits helped soften the blow, supporting incomes and spending amid widespread unemployment. As a result of this
assistance, researchers found poverty actually declined in the April-June period compared with the pre-pandemic January-February period.
But that government assistance proved to be temporary — with the supplemental jobless benefits expiring in July — and lawmakers are at a standstill over another stimulus package. The same researchers also found poverty rose by a full percentage point for July and August compared with April to June.
The top 5% of households — those making $451,122 on average last year — have seen their inflation-adjusted incomes jump 28% since 2009, the Census Bureau said.
The gain — which helped push inequality to the widest in decades — compares with an 11% rise for the bottom 20%, whose income rose to about $15,290 from roughly $13,800 a decade ago. Those in the middle groups — who made between $40,600 and $111,100 last year — saw their incomes rise between 16% to 18%, the data show.
DISPARITIES IN GAINS
Income gains spanned demographic groups, though disparities remained wide.
In 2019, the real median incomes of non-Hispanic white households increased 5.7% to $76,057, while Black households climbed 7.9% to $45,438 and Hispanic households rose 7.1% to $56,113. Asian households recorded a 10.6% increase, to $98,174.
Rural America didn’t share in as much of the gains, though. Households outside metropolitan statistical areas saw income rise 2.6% in 2019, an increase deemed not statistically significant, according to the report. Their median income was just $52,100, compared with $71,961 for families inside metro areas, who saw a 6.8% rise.
The female-to male earnings ratio as well as the Gini index, a measure of income inequality, were not statistically different from the prior year, according to census.
Tuesday’s report also showed the share of Americans without health insurance amounted to 8%, or 26.1 million people, in 2019.
However, the Census Bureau suggested using a separate measure this year when comparing with previous years, given the pandemic’s effect on the survey. In 2019, 9.2% of Americans, or 29.6 million, were not covered by health insurance at the time of interview, an increase from 8.9% in 2018.
While the data are for 2019, they were collected between February and April of this year, a time frame that coincided with the start of business closures and stay-athome orders in the U.S. Response rates were lower than usual — falling below 80% — in part because survey-takers didn’t visit respondents in person, the bureau said.
POVERTY RATE DEMOGRAPHICS
There were other divides in the data. Women were still more likely to live in poverty — 11.5%, compared with 9.4% of men. The share of singlefemale households in poverty improved from the previous year but remains very high at 22.2%, more than double the national level.
The Census Bureau considers a two-parent, two-child household with less than $25,926 in income to be living in poverty; the measure differs by size of household.
Minority groups saw bigger declines in poverty in 2019, the census report showed, but also have much higher poverty rates. The poverty rate for whites dropped 1 percentage point to 9.1%; for Asians it was down 2.8 percentage points to 7.3%. Black poverty dropped 2% to 18.8%, and Hispanic poverty decreased by 1.8 percentage
points to 15.7%.
Those figures suggest that many families were still on edge as state and local lockdowns prompted the sharpest job losses on record, pushing the unemployment rate up to 14.7% in April. While unemployment has declined to 8.4% as employers call temporarily furloughed workers back, that left about 10 million fewer people employed in August than in February.
Unemployment was hovering at around 3.5% before the crisis took hold, the lowest in 50 years, and wages were steadily rising. Yet at the end of 2019, 3 in 10 adults said they could not cover three months’ worth of expenses with savings or borrowing in the case of a job loss, according to a Federal Reserve survey.
While the Labor Department’s monthly employment reports and the Commerce Department’s monthly personal income reports offer more timely insights into earnings, the annual census data give a more comprehensive view of household incomes.