Income and Wages

Income Up, Poverty Drops

Poverty rates are falling and the U.S. median household income, adjusted for inflation, has surpassed 1990 levels, according to the Census Bureau's latest report. Income is still slightly below the record set in 1989, however.

Poverty among black families dropped last year to the lowest level ever recorded, while Hispanics experienced the largest one-year drop in 20 years.

Here are some of the figures for 1997:

  • Median household income rose 1.9 percent from 1996 -- to $37,005.

  • The poverty rate fell to 13.3 percent overall from 13.7 percent -- with the rate for blacks at 26.5 percent, and Hispanics at 27.1 percent.

  • Median income for black households rose 4.3 percent, while Hispanics enjoyed a 4.5 percent gain.

  • Whites saw income grow by only 2.5 percent.

Earnings for women working full time rose by 3 percent, compared to 2.4 percent for men.

The recession of 1990-91 disrupted the economic progress of the typical American family. In 1989, median income reached a peak of $37,303. By 1993 it had fallen to $34,700.

By region, the South and West were the biggest beneficiaries of last year's booming economy. Incomes in the South rose by 3.6 percent and in the West by 3.1 percent. Incomes rose in the Midwest by 2.4 percent, but were virtually unchanged in the Northeast -- which had enjoyed the biggest gains in the 1980s.

While it has taken eight years for income to rebound from the last recession, the average for such a recovery of income since World War II has been five years.

Sources: Jacob M. Schlesinger, "Finally, U.S. Median Income Approaches Old Heights," Wall Street Journal, also Beth Belton and Richard Wolf, "Incomes Rebound as Poverty Rate Slips," USA Today, both September 25, 1998.

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