American income falls as inflation increases, U.S. Census bureau says
Americans are bringing home less money as inflation squeezes family budgets, according to a new report from the U.S. Census Bureau.
The U.S. Census Bureau announced Tuesday that real median household income fell in 2022 compared with 2021. Real median household income fell by 2.3% from $76,330 in 2021 to $74,580 in 2022.
At the same time, the cost of goods and services is increasing. Between 2021 and 2022, inflation rose 7.8%. That is the largest annual increase in the cost-of-living adjustment since 1981, according to the U.S. Census Bureau.
The official poverty rate of 11.5% was not statistically different between 2021 and 2022, but the Supplemental Poverty Measure rate in 2022 was 12.4%, an increase of 4.6 percentage points from 2021. It is the first increase in the overall Supplemental Poverty Measure rate since 2010. The Supplemental Poverty Measure is a measure of economic deprivation that addresses some of the limitations of the official poverty measure, according to the Congressional Research Service.
“This increase can be attributed to key changes in federal tax policy, including the expiration of temporary expansions to the Child Tax Credit and the Earned Income Tax Credit as well as the end of pandemic-era stimulus payments,” according to the U.S. Census Bureau.
The real median earnings of all workers, including part-time and full-time workers, decreased by 2.2% between 2021 and 2022. Median earnings of those who worked full-time, year-round decreased 1.3%, according to the U.S. Census Bureau.
More people worked full-time jobs in 2022. Between 2021 and 2022, the number of full-time, year-round workers increased by 3.4%, compared to a 1.7% increase in the number of total workers.
“This suggests a continuing shift from working part-time or part-year to full-time, year-round work in 2022,” according to the U.S. Census Bureau.
The official poverty rate in 2022 was 11.5%, with 37.9 million people in poverty – similar to 2021.
