US Incomes Rose Last Year but Poverty Rates Changed Little

  • U.S. inflation-adjusted household income increased, but poverty rates showed only modest changes last year, the U.S. Census Bureau reported on Tuesday, offering a mixed snapshot of how American households fared as the economy returned to pre-coronavirus pandemic growth levels.
  • Real median household income rose to $80,610 in 2023, up 4.0% from 2022, back to the peak reached in 2019, while earnings for workers were higher than before the pandemic, a boost to households after multiple years in which workers' wages were outpaced by high inflation.
  • The report also showed a main gauge of the nation's poverty rate, adjusted for government support such as food assistance and tax credits as well as household expenses, rose to 12.9% from 12.4% in 2022. The so-called official poverty rate declined to 11.1% from 11.5%.
  • The Census noted, however, that the adjustments to income levels used to determine whether a person lived in poverty were larger for the supplemental measure than for the official measure in 2023. Had the official threshold increase been applied for the supplemental rate, that rate would have declined to 12.0% from 12.4% the prior year. In 2023, the threshold for the official rate increased by 4.1% to $30,900 for a two-adult, two-child household.
  • The supplemental child poverty rate, also adjusted and referring to those under the age of 18, rose to 13.7% in 2023 from 12.4% the previous year. The rise in the supplemental child poverty rates was impacted by the end of extra pandemic-related government benefits. For example, extra pandemic-related food assistance programs ended in March of last year in a majority of U.S. states, and school meal aid also narrowed.
  • The income and poverty data for 2023 comes two months before the U.S. presidential election. The shadow cast by a surge in inflation following the onset of the pandemic in early 2020, and how much that has squeezed pocketbooks of voters once government support programs designed to shore up household incomes expired, remains a key issue.

(Source: Reuters)