Household Income Falls; No Recession?
So officially we’re not in a recession anymore, right? Well tell that to families, as census statistics reported that income went down for the second year in a row, there are fewer families making $100,000 a year in income, there are more people without health insurance and there are more people living in poverty, 14.3%. The median income for families is now $50,220, which was a 3% drop from the previous year. Overall, people in Maryland make the most money while people in Mississippi make the least.
Minorities have it worse, which figures. Unemployment is at 17% for blacks, and exceeds 20% in five states. In Michigan, the unemployment rate for black people is around 27%; ouch! The high for Hispanics is 22% in Nevada. You want more? An organization called United for a Fair Economy stated that “blacks and Hispanics are three times as likely to be poor as whites, that blacks earn 62 cents for every dollar whites earn, and that the family median net worth of whites in 2007 was $170,400, compared with $27,800 for blacks and Hispanics.”
Not to pile on here, but the Federal Reserve reported last Friday that household net worth fell 2.8% in the second quarter of this year, and it would have been worse if there hadn’t been enough wealthy people to bring the average up some. It was the first drop since early 2009, when things were in crisis mode.
The one good thing… well, sort of good depending on who you ask. People are saving around 6% of their disposable income now as opposed to 2% in 2007. Bills are being paid, but spending has been drastically reduced, which is hurting many industries. Unfortunately we can’t have it both ways, but I tend to believe that as more of us become fiscally responsible, things will work out in the end.
That is, if banks stop closing, since we’re now up to 127 banks with no sign that it’s slowing down.