Median family incomes grew for the second consecutive year in 2016 to reach a new all-time high, according to new figures released Tuesday by the Census Bureau, and poverty fell again.
Median household income rose to $59,039, the bureau's Current Population Survey showed, finally eclipsing the previous peak of $58,665 set in 1999. The agency adjusts the income figures to try to account for inflation.
A Census official cautioned that historical comparisons are complicated by the fact that the survey's questions about income changed in 2014, leading to differences that may not reflect underlying changes in people's lives. "We really cannot tease out" how much of the changes reflect the questions changes, said Trudi Renwick, chief of the poverty statistics branch at the bureau.
Nevertheless, the new data makes clear that the last two years of Barack Obama's presidency, seven years into the economic recovery, finally saw middle incomes not only recovering from the financial crisis, but also at or near the highs temporarily reached during the tech bubble. The latest indicators suggest that incomes have continued to rise under President Trump in 2017.
The good news from 2016 adds to the breakthrough gains in incomes in 2015. In that year, median incomes finally stopped falling, and rose the fastest of any single year on record, accompanied by a drop in poverty.
In part, those improvements came because workers received raises at work, or better wages, said Renwick. But another major factor was that more people found jobs, and more workers held full-time work.
During 2016, rising incomes continued to push down poverty. In the year, 40.6 million people fell below the poverty line, a decrease of 2.5 million on the year. The poverty rate, at 12.7 percent, was back to where it was on the eve of the recession. For a couple with two children, the poverty threshold was $24,600 in 2016. During the worst of the recession, more than 46 million people were counted as in poverty.
One well-known flaw in the poverty measure is that it excludes many of the government benefits meant to address poverty, including in-kind benefits like food stamps and tax credits. The Census Bureau now also publishes a supplamental measure that tries to account for those income sources. By that measure, poverty fell from 14.5 percent to 13.9 percent in 2016.
Nevertheless, not all groups have benefited from the recovery, even as the economy has seen clear improvements.
For example, incomes at lower levels have not recovered as quickly as the high end, according to the Census figures. Incomes at the tenth percentile remain below the pre-crisis level.
And while other racial and ethnic groups appear to be earning more than ever before, the same might not be true for black families. The median black household income was $39,490 in 2016, compared to $41,363 in 2000.