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On Wealth and Poverty in the USA

On Wealth and Poverty in the USA

Median incomes should not be confused with average incomes. If all people in a certain group are lined up in order of increasing income, the median income is the income of the person in the middle. In some cases, the median reflects reality more accurately than the arithmetic mean because it is not skewed toward the lowest or highest values.<\/p>\n

The highest median incomes are earned by households in San Jose, California. Their annual income is $74,000. Also among the highest-earning were households in Plano, Texas. In California, the second and third places for income were taken by San Francisco and San Diego.<\/p>\n

The lowest incomes in cities with a population of more than 250,000 people in 2006 were earned by households in Cleveland, Miami, Buffalo, and Detroit.<\/p>\n

In 2006, Asian Americans earned the most in the USA. Their median annual income was $64,200. Non-Hispanic whites earned an average of $52,400 per family, while Latinos earned $37,800. African American families earned the least, with an income of $32,000.<\/p>\n

The most affluent regions of the USA were the Northeast and the West. Households there earned $52,100 and $52,200 respectively. Americans living in the mid-Atlantic region ($47,800) and the South ($43,900) earned somewhat less.<\/p>\n

The median income of households headed by native-born Americans in 2006 was $49,100. Foreign-born residents earned an average of $43,900 per family.<\/p>\n

Income inequality between the rich and the poor also remained statistically unchanged. In the USA, the Gini index* was 0.47 in 2005 and 2006. Since 2002, income inequality has increased by 1.7% from 0.462. This means that the poorest 20% of Americans receive 3.4% of all income, while the richest 20% receive 50.5% of income.<\/p>\n

However, the authors of the report note that the incomes of the poor have declined somewhat not because they are paid less at their current jobs. The Census Bureau does not give a precise explanation, but suggests a connection with people moving from part-time to full-time employment with lower pay. Notably, the poverty rate among Latinos has decreased somewhat.<\/p>\n

Another interesting observation by researchers is that the proportion of U.S. residents below the poverty line fell from 12.6% to 12.3%. This is associated with a serious methodological problem. Using the term "poverty line," scientists mean the cost of a certain consumer basket, which mainly includes food and does not consider many things without which a modern person cannot live. As an example, they cite San Jose, California, and Omaha, Nebraska. The cost of living in the former is much higher than in the latter. Nevertheless, the poverty line in both is considered $20,444 per year for a family of four. If in Omaha one can actually live on this money without receiving social assistance, then in San Jose, a household earning even one dollar more will lose state support. It will be difficult to make ends meet on that amount.<\/p>\n

* To measure inequality, a special indicator, the Gini index, is used. It ranges from zero to one. Zero would mean that all people (or groups of people) receive the same income, and one would mean that all money in the economy goes to one person (or group). <\/em><\/p>\n

Anton Pominov.
Lenta.ru<\/a><\/strong><\/p>