“Happy days may be here again for America’s middle class.” But be careful not to attribute the good news with the Trump presidency. The assessment is for 2016 while President Barack Obama was still in office.
“The US Census Bureau’s annual look at income and poverty showed a whopping 5% boost last year to the paychecks of middle-class families, although incomes still remained below pre-recession levels. But a full decade after the crisis began, median 2016 household incomes are above or approaching those in 2007. According to census data, inflation-adjusted median household income reached $59,039 in 2016, a 3.2% bump from 2015. (The median income is the midpoint of the US income distribution: Half of US households have higher incomes, half have lower incomes.)
“Moreover, the middle class appears to be doing better than it ever has in the recorded history of the survey, which began in 1984. Middle-class incomes peaked in 1999, before the frothy years of the dot-com bubble. Adjusted for inflation, current median household income has finally edged past its 1999 level which was close to, but under, $59,000, inflation-adjusted.”
“The picture of a destroyed, weakened middle-class figured heavily in Donald Trump’s 2016 campaign speeches, but perhaps like so much about Trump that belief isn’t based on reality.
“Last year, the American middle class did remarkably well.”
How will America make out in 2017? To use one of Trump’s favorite responses, “We’ll see!”
You might have seen reports that middle-class incomes in America reached their highest level ever last year. Watch your wallets. What the headlines don’t tell you is:
1. Middle-class households have been on a downward escalator for almost two decades. The median income is only now rising above what it was in 1999.
2. Inequality is widening. The top fifth of earners are taking home more than half of overall income. That’s a record.
Huge racial disparities remain.
3. The median African American household earns only $39,490, compared with more than $65,000 for whites.
4. The main reason median incomes have surged since 2014 is millions more are finding full-time jobs -- not that employers are giving raises to people already employed.
5. A growing percentage of the workforce is in contract or freelance work, whose incomes are precarious and could drop any time.
6. Oh, and in Trump's first 7 months, the U.S. economy has added about 25,000 fewer jobs that it did during the last 7 months of Obama's presidency.
So don't break out the champagne.
By Preeti Varathan
