Good News on Income

The Bureau of Labor Statistics (BLS) has released its latest data regarding household and individual income, highlighting encouraging trends for the American economy.

In 2024, real median household income hit an unprecedented $83,730, marking a notable recovery from the declines initiated by the pandemic in 2020. Simultaneously, real median individual income also achieved a new peak at $45,140 for the same year.[1] The consistent upward trajectory of these figures since the 1980s is particularly telling.

These statistics challenge narratives from both progressive and right-wing circles that suggest stagnation in American incomes. Notably, real median household income has surged by 38.6% since 1984, while real median individual income boasts a remarkable increase of 57.1% since 1974.

A thriving economy is imperative for the rise in income levels. Historical data reveals that income stagnation coincides with recessions, while growth aligns with periods of economic expansion. Some analysts, such as E.J. Antoni, who was endorsed by Trump to lead the BLS, argue that the U.S. has been in a recession since 2022; however, data does not substantiate this claim.[3]

Despite some short-term worries—such as escalating tariffs, weak employment rates, persistent inflation, and rising economic isolationism—the long-term outlook for the U.S. economy appears promising. Recognizing the data’s positive indicators is essential in combating a narrative of defeatism.

——
[1] To clarify, “real” denotes “inflation-adjusted,” and “median” indicates the midpoint where half of the households earn more and the other half earn less, thus excluding extreme values of both wealth and poverty from skewing results. Therefore, these findings are not propelled solely by inflation or gains concentrated among the ultra-wealthy.

[2] Data on real median household income dates back to 1984, while individual income data extends to 1974. Since household income typically correlates closely with individual income, it’s plausible that household incomes began to rise even earlier than 1984.

[3] Further empirical and theoretical examination challenges the claim that the U.S. has been in recession since 2022. A detailed critique can be found in America in Recession Since 2022? A Critique of Antoni-St. Onge authored by economist Menzie Chinn from UW-Madison.

RECENT POST