U.S. Median Household Income In 2018 Sets Another Record

It’s that time of year, the Census Bureau just released the official income statistics for 2018 a few weeks back.  In 2018 the median household income in America was $63,200, the highest figure ever.  From 2017 to 2018, inflation-adjusted median household incomes grew in 33 states and the District of Columbia.

And there’s more good news.  As this Washington Examiner story reports:

“The official poverty rate also reached its lowest level since at least 2001, dropping to 11.8% of Americans, or 38.1 million people who are in poverty, according to the Census Bureau measurements. The number of people in poverty in 2018 decreased by 1.4 million people from 2017 levels.” 

All of this great news wasn’t covered much in the media.  I suspect it’s because the data and facts continue to fly in the face of the big-media message that middle class incomes are “stagnant”. 

I’ve posted about that before, showing that median incomes in America have beat inflation handily dating back to 1984.  And my friend Zach at Four Pillar Freedom also posted about it, challenging this constant media message.  Some in the big media, thankfully, are trying to paint a more balanced picture.

The Data

As Accidental FIRE fans expect, I mapped out the median household income data in my nifty map flux capacitor machine.  So here you are (click for larger version):

My post from last year shows the data and map from 2017.  Of note, Hawaii joined the $80,000 club making it three states and the District of Columbia in that category.  And of course the northeast, or brunch belt as I call it, continues to thrive.  

In and of itself it’s hard to see which direction things are going for each state.  So I also calculated the percent change from 2017 to 2018 and mapped that as well (click for larger version).

The three states with the highest percentage increase from 2017 (inflation adjusted) are:

• Idaho:  3.9%
• Vermont:  3.2%
• Florida:  2.9%

The three states with the highest percentage decline from 2017 (inflation adjusted) are:

• Maine:  -3.6%
• Nebraska:  -3.0%
• South Dakota:  -2.8%

Other Metrics

The Census Bureau’s report also mentioned these metrics:

• Real median household income in the United States increased 0.8% between 2017 and 2018.
• The 2018 median household income was the highest measured by the American Community Survey.
• Median household income in 29 states and Puerto Rico was lower than the U.S. median. It was higher than the U.S. median in 18 states and the District of Columbia. 
• Median household income increased in 10 of the 25 most populous metropolitan areas between 2017 and 2018.  None of those 25 metropolitan areas experienced a statistically significant decrease.
• From 2017 to 2018, the poverty rate declined in 14 states and Puerto Rico. In 2018, the poverty rate increased in only one state: Connecticut. 
• California, Florida, Georgia and North Carolina had declining poverty rates for the fifth year in a row. In three states (Arizona, Illinois and New York), poverty declined for a fourth consecutive year. 
• For the fourth year in a row, the percentage of people in poverty decreased in the three most populous metropolitan areas: New York-Newark-Jersey City, NY-NJ-PA Metro Area; Los Angeles-Long Beach-Anaheim, CA Metro Area; and Chicago-Naperville-Elgin, IL-IN-WI Metro Area.

In Conclusion

Economists on both sides of the argument as to whether middle class incomes are stagnant have been accused of cherry picking their data.  Fair enough. 

But what none of them seem to talk about is that the middle class is living better than ever in 2019.  Twenty years ago the middle class didn’t have tablets and smartphones, and all sorts of other convenience items that weren’t even dreamed up. 

Additionally, the average house size was way smaller, but families were bigger.  So even if you prescribe to the notion that middle class wages are stagnant, it’s hard to argue against the reality that the middle class is living better than ever on that wage.