Income and Poverty Rate Held Steady in 2012

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Written by: Chuck Nelson

Between 2011 and 2012 in the United States, neither real median income nor the poverty rate changed. For the previous four years (2008, 2009, 2010, 2011) either poverty increased (2008, 2009, 2010) or median household income decreased (2008, 2010, 2011).

Median Income and Poverty rate, 1967 to 2012

Blue bars denote recession periods

As you can see from these charts, when poverty goes up, median income historically tends to go down. Some years the change for one estimate is statistically significant while the change for the other is not. It’s also noteworthy that for the first time since 1992, the year-to-year changes for both estimates were not statistically significant ─ in other words, not enough to be considered a real change.

So while we are not seeing income increase and poverty fall, we are not seeing the opposite either.

The lack of change between 2011 and 2012 was widespread for both income and poverty across demographic groups, geographic regions and other characteristics.  Likewise, most earnings estimates were flat across the two years and there was no change in the female-to-male earnings ratio.   Most measures of income inequality were the same in 2012 as in 2011.

One area with a positive change was in the number of workers.  There were 2.7 million more people with earnings in 2012 than in 2011. One million more men reported full-time, year-round work in 2012 than in 2011. The change in the number of women working full time, year- round was not statistically significant.

The findings show that our nation has not yet recovered to its prerecession circumstances. Median household income in 2012 was still 8.3 percent lower than in 2007, the year before the most recent recession. Poverty was 2.5 percentage points higher than in 2007. Median income was also 9.0 percent lower than the median household income peak that occurred in 1999.

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3 Responses to Income and Poverty Rate Held Steady in 2012

  1. TAINA TRAVERSO says:

    ****>RAISE WAGES AND TAX THE 400 SUPER RICH.
    THE 1% RICH INCOME HAS SKY ROCKETED, HAS NOT HIRED MANY OF THE UNEMPOLYED AND THOSE THAT HAVE BEEN HIRE, CAN’T LIVE ON THE MEAGER SALARIES…. THE STRUGGLE CONTINUES.

    • Shreeshyam says:

      This is interesting infaomotirn and I appreciate your sharing it.I have to wonder to what extent does migration (in and out) play into driving some of these kinds of averages? I believe there is a tendency to immediately envision changes in median incomes and poverty as indicators of a static population’s status. Incomes went down and poverty went up because more people lost their jobs, for example.But to what extent are these changes also explained by the movement of people. Did more people with lower incomes move here? Or did more people with high incomes leave?I expect it’s a combination of a number of factors. But it would be helpful to put infaomotirn like this in context of our dynamic system. Any resources that further explain this phenomenon would be appreciated.Thank you.

  2. Cornelia Hicks says:

    This is better than the inverse happening. I have every confidence that we are still on the road to recovery. Whether or not the budget crisis will throw our economy into a tailspin remains to be seen, however, I recognize that this administration has adverted all types of crises. And for that, I am grateful.

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