$70,784. That was the real median household income in the United States for 2021, according to the Census Bureau report “Income in the United States: 2021,” published on September 13, 2022. The 2020 figure was $71,186, and the bureau called the gap between the two statistically meaningless. In plain terms, the typical household went nowhere.
CBS News added a longer view from the same report: the 2021 median sat 2.8% below the 2019 level, the last year before the most recent recession. Two years of stagnation or decline, then, in a stretch dominated by the pandemic economy.
What the number measures
The detail that matters is how the bureau builds it. The figures come from the Current Population Survey Annual Social and Economic Supplement, and they follow a “money income” concept: everything received by each household member aged 15 and older, before tax, leaving out items such as capital gains. Stimulus payments and tax credits, including those from the American Rescue Plan Act, are not counted in the headline estimate. An appendix to the report gives post-tax figures that do include them, and on that basis real median household income in 2021 was again not statistically different from 2020.
The bureau also warned that its 2020 estimates in this report will not match last year’s, because they now use population controls based on the 2020 Census.
Inequality ticked up
Income was flat, but the spread was not. By the money income Gini index, inequality rose 1.2 percent between 2020 and 2021. It was the first annual increase in that index since 2011. Measured after tax, the change was not statistically significant.
The earnings data point in two directions at once. Median earnings of all workers, part-time and full-time together, climbed 4.6 percent in real terms. Median earnings of those working full-time, year-round fell 4.1 percent. The explanation sits in the worker counts: the number of full-time, year-round workers grew by about 11.1 million, from roughly 106.3 million to 117.4 million, which suggests many people moved from part-time or part-year work in 2020 into full-time jobs in 2021.
Gaps by sex and race persisted. CBS News quoted the report: the median woman working full-time earned $51,226 against $61,180 for the median man. Asian households had the highest median income at $101,418, followed by non-Hispanic White households at $77,999 and Hispanic households at $57,981. Black households had the lowest, at $48,297.
All of this landed against rising prices. The bureau’s inflation adjustment measured a 4.7 percent increase in consumer prices between 2020 and 2021, and CBS noted that inflation hit 8.3% in August 2022 compared with a year earlier.
A companion Census study put the supplemental poverty rate at 7.8% in 2021, down from 9.2% in 2020. The rate for children dropped from 9.7% to 5.2%. Social Security, the bureau said, moved 26.3 million people out of poverty on that measure, while refundable tax credits and stimulus payments moved 9.6 million and 8.9 million. Mark Rank, a social welfare professor at Washington University, told CBS News he expected poverty to rise as pandemic relief faded.
Sources
- Income in the United States: 2021
- Median U.S. income remained stagnant while supplemental poverty levels showed significant decrease last year, Census Bureau finds – CBS News
