Middle-class income was the highest on record last year, new data shows, but those numbers may be a little misleading.
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According to the U.S. Census Bureau, the median U.S. household income was $61,372, the largest amount since the bureau began recording the data in 1967, and a 1.8 percent increase over 2017. Throughout the past three years, incomes have grown more than 10 percent.
The poverty rate also fell to the lowest level since 2006.
But for those Americans still wondering where their pay raise is, there could be an explanation.
Changes in the way these numbers were calculated over the years mean that last year’s median income was in fact slightly lower than numbers recorded in 1999 and 2007, U.S. Census Bureau Officials cautioned.
While wages in August grew at the fastest rate in nearly a decade, they are, overall, still below the historical averages experienced before the recession. They also rose because more people were working more hours, not necessarily because their pay rates actually increased, as reported by The Wall Street Journal.
Even Federal Reserve chair Jerome Powell admitted wage stagnation was “a bit of a puzzle,” given strength in the labor market and an abundance of labor shortages across a variety of industries.
Nevertheless, President Trump touted the income statistic on Twitter Thursday, using the opportunity to campaign against Democrats as the midterm elections approach.
Trump sparred with President Barack Obama last week over the economic recovery, after the former hit back at claims the current administration was solely responsible for the uptick.
“By the time I left office, household income was near its all-time high, and the uninsured rate hit an all-time low, poverty rates were falling. I mention this just so when you hear how great the economy is doing right now, let's just remember when this recovery started,” he said in a speech on Friday, adding that the job numbers are similar to those seen in 2015 and 2016, when he was in office.
Trump fired back, using a quote from
Trump came under fire last week for inaccurately claiming the GDP rate, which recently hit 4.2 percent – the best in nearly four years – had eclipsed the unemployment rate of 3.9 percent – a near 18-year low – for the first time in more than a century.