WASHINGTON, Sept 12 (Reuters) – Inflation-adjusted incomes fell and key poverty indicators rose sharply last year, Americans say, as the U.S. economy continues its difficult recovery from a once-in-a-century pandemic. The Bureau of Investigation reported Tuesday.
Income and poverty data released by the Census shows how the country’s recent economic performance has been deeply affected by the COVID-19 health crisis and the government’s response to the pandemic. Since the end of the era, child poverty measures have more than doubled. The child tax credit went into effect last year, and the worst inflation in 40 years eroded household purchasing power.
The child poverty rate, based on supplementary measures that adjust government benefits and household spending, rose from 5.2% in 2021 to 12.4% in 2022.
Overall, the supplemental poverty rate rose from 7.8% in 2021 to 12.4% in 2022, a change also largely due to the end of the pandemic-era program, Census officials said.
Compared to pre-pandemic 2019, the overall supplement rate was slightly higher than 2019’s 11.8%. The so-called official poverty rate was almost unchanged from 2021 at 11.5%.
Meanwhile, household incomes were barely keeping up with the 7.8% rise in consumer prices, the highest since 1981.
Real median household income fell 2.3% to $76,330, about 4.7% below 2019, census officials said.
The report provides the first clear glimpse of how the economy has bounced back from the health crisis that shuttered stores and factories in 2020 and continued to suppress activity through much of 2021. The performance of the U.S. economy continues to be mixed, with growth expected despite higher-than-ever Federal Reserve interest rate hikes and inflation still high.
The current unemployment rate of 3.8% is comparable to that in 2019, and Census officials say several aspects of the economy, such as record numbers of women in the labor force and black poverty rates, are He noted that he seemed to be stronger than before. While the rate for Americans was much higher than the national average of 17.1%, it hit an all-time low last year.
Household income also increased slightly for African American and Hispanic households, but decreased for other households.
Changes in U.S. employment patterns due to the pandemic, which increased competition for labor among restaurants and other service industries desperate for workers, also benefited lower-income and less-educated workers. . Median income, adjusted for inflation, increased by 6.4% for households where the head did not graduate from high school, but decreased for households with a high school or college degree.
But even some of the positives continued to be distorted by the pandemic.
On a pre-tax basis, income inequality in the United States narrowed by 1.2% last year as wages for low-income earners rose slightly while real incomes for middle- and high-income earners fell. This was the first statistically significant decline in income inequality since 2007.
But the expiration of pandemic-era refundable tax credits offset that, increasing income inequality by more than 3% on an after-tax basis.
Reporting by Susan Heavey and Rami Ayyub. Editing: Doina Chiacu, Andrea Ricci, Aurora Ellis
Our criteria: Thomson Reuters Trust Principles.