Written by: David Johnson, US Census Bureau
An economic recession is typically defined by the National Bureau of Economic Research as a decline in the gross domestic product for two or more consecutive calendar quarters. The last recession began in December 2007 and ended in June 2009.
Numbers just released by the Census Bureau, however, illustrate that while the recession may technically be over, household economic conditions did not improve.
Every year, the Census Bureau collects data on how much income households receive. The year 2010 is the first full calendar year after the latest recession and the first chance we have to see whether, based on income, economic conditions have improved since the recession’s end.
The answer is “no.” During the 2010 calendar year, median household income was $49,445, 2.3 percent lower than in 2009 after adjusting for inflation. Median indicates half of households had income more than this amount and half less. The total household income indicates the amount of money everyone 15 and older living in the household collectively brought in that year.
More often than not in recent history, the end of a recession has not immediately led to rising income levels. There have been seven recessions since 1969. In four of them, including the last one, median household income actually declined in the first full year after the recession. On two other occasions, the change was not statistically significant. Only once did it actually increase.
Over the years, researchers and analysts have used these annual income estimates to chart the effectiveness of government programs, gauge the economic well-being of the country, develop marketing strategies for business and assess the impact of changing demographic patterns. These numbers are considered the most timely and accurate national data on income.
Respondents in our surveys may feel uneasy giving information on personal subjects like income. However, this is how the nation determines our economic health – through analyzing the responses of households across America. Furthermore, there is no need to worry. All Census Bureau employees take an oath and are sworn for life not to share any personal data with anyone.