The middle class in the US and around the world is slowly diminishing. You probably hear this all the time. Even though there’s no actual definition of what constitutes the middle class in the US, one thing is clear—many people above the poverty line and below wealthy status are struggling.
US income trends suggest that those in the middle range constantly feel the pressure from stagnant wages to rising living costs, inadequate retirement preparations, and massive vulnerability to unexpected financial tribulations.
Let’s take a look at the current income statistics in the US and other countries worldwide.
- In 2019, the top 20% of the population earned 51.9% of all US income.
- An average US individual income was $62,518.13 in 2020.
- The median household income was $66,039 in January 2021.
- The net worth of an average American aged 35 to 44 is $436,200.
- America’s wealthiest families have an astounding $1.2 trillion of collective wealth.
- The United States GDP could hit 10% by the end of the first quarter of 2021, the Atlanta Federal Reserve tracker reveals.
- The Institute for Policy Studies revealed that the total wealth of American billionaires grew to $4.085 trillion in the last ten months.
- In 2019, the median household income for Asian households stood at $98,174.
- The median household income of Hispanic households was $56,113 in 2019.
The US economy is considered the strongest and the largest one globally, and even though economic growth doesn’t always lead to higher income, it helps. Take a look at the most interesting facts about US income.
1. US population by income statistics reveal that the top 20% of the population earned 51.9% of all US income in 2019.
A significant disparity in income distribution between individuals, groups, populations, and social classes in the US leaves no space to question this economic phenomenon’s existence.
Several factors cause income inequality in America. These include, in no particular order, tax policy, unemployment, globalization, increased automation, the decline of the unions, race disparities, gender identity, and salary gaps. All these factors widen the gap between the upper and working class.
2. According to the 2020 Knight Frank Wealth Report, the US top 1% income is $4.4 million.
Different countries and territories have various levels of net wealth that mark the threshold for entering this exclusive community. To get in the top earner’s group in the US, you’ll need to make at least six figures.
3. The average individual income in the US was $62,518.13 in 2020.
Adding up every worker’s earnings in an entire year then dividing by the number of workers will show the average individual income of the country. Data collected in 2020 in the US showed an increase of $4,138.68 from 2019 figures.
4. In 2021, median household income by year statistics indicate a household income decrease of an estimated 0.4% compared to December 2020.
The initial estimate of median household income in January 2021 was $66,039, which is lower than the data collected in December 2020 according to US household income statistics. This month-over-month decline is the first one since August 2020.
The cause of the decline was due to lockdown measures that several state and local governments imposed in late November or early December 2020.
5. Distribution of wealth in America suggests that the share of net wealth in the US by the top 10% increased to 69.2% in Q3 2020.
Wealth distribution in the US is constantly changing over time according to the income inequality in the US statistics. In the last 20 years, the wealth share of the top 10% remained broadly constant at around 37%. The percentage of the top 1% increased from 23.5% of net wealth to 31%.
6. Data from the Federal Reserve reveals that the net worth of the average American aged 35–44 is $436,200.
A person’s circumstances, such as income, cost of living, family inheritance, race or ethnicity, housing status, and educational background, widely affect the net worth, as the US income demographics data suggests.
Since assets appreciate over time, the net worth tends to increase with age, and people usually benefit from higher earnings as they progress in their career.
7. The collective wealth of America’s richest families stands at $1.2 trillion.
The wealthiest families in America are taking the whole idea of “born with a golden spoon” to another level. These people aren’t just rich. They’re tremendously rich.
According to Forbes’ 2020 ranking, the top five families are Walton, Koch, Mars, Cargill-MacMillan, and Lauder family.
8. In 2019, the average American yearly salary amounted to $65,836.
Dividing the total wage amount based on national accounts with the national average number of employees will result in a figure which, after multiplied by the average weekly hours per full-time employee, expresses the average wage.
9. In December 2020, the estimated median individual income in the US was $66,280.
The median is the most critical summary statistic for income data. It differentiates the point where half of the workers make more money and half make less.
The latest available US personal income statistics reveal an estimated $3,106 rise in median individual income in 2020.
10. The US GDP was expected to hit 10% by the end of the first quarter of 2021.
The United States economy growth rate has taken an unexpected turn in the early months of 2021. The first-quarter growth rate defied even the rosiest predictions as another fresh influx of cash loomed.
GDP and income are closely related—with the decrease of GDP growth rate, income inequality is increasing. It is yet to be seen how this sudden increase of GDP affects the average income in the US in 2021.
11. The total wealth of American billionaires grew to $4.085 trillion in the last ten months.
While for many Americans the value of their debt exceeds the value of their assets, a closer look at the wealth inequality in America over time reveals that America’s wealthiest families are constantly adding to their net worth.
As ordinary people worldwide suffer from the health and economic impacts of the pandemic, billionaires have seen their fortunes expand.
12. According to 2019 US household income distribution data, more than 53% of Americans had an annual household income that was less than $75,000.
In recent decades, income inequality has drastically increased in the United States. The Northeast region is one of the wealthiest in the US. Maryland, New Jersey, and Massachusetts were among the states with the highest median household income in 2019.
13. The US retirement income statistics suggest that the median household retirement income stood at $56,632 in 2021.
The average retirement income is a tricky thing to analyze. Retirement has no official definition, with many “retirees” still working. For most people, retirement income falls dramatically by age. Households older than 75 have the median household income higher than the household income for those aged 60–64.
14. US disposable income statistics indicate a decrease in disposable personal income to $17,721.012 billion in February 2021.
The disposable personal income, or after-tax income, is what’s left after people pay their taxes. The latest US income distribution data from 2021 define it as the amount that US residents can spend, save, or invest—it’s essential not just to individuals but also to the whole economy. In January 2021, disposable personal income amounted to $19,240.942 billion, however these figures decreased by 8% in February.
The ever-present disparities in income between different races in the US are hard to deny. The general opinion is that historical and current practices created an atmosphere where some communities often face various disadvantages.
15. According to income by demographic data, Asian households had a median household income of $98,174 in 2019.
Even though Asians rank as one of the highest-earning racial and ethnic groups in the US, not all Asians share this status.
If you look at the income ladder, you can easily notice a widening gap in the living standard between Asians near the top and the bottom of the income ladder.
16. According to the US income distribution statistics, the median household income for African American households rose to $46,073 in 2019.
Even though African American households finally surpassed their highest median income since the recession in 2007, this recovery has been cut short by the current pandemic economic turmoil.
While there isn’t any available data on the average household income in the US for 2021, the most recent data by the US Census Bureau reveals that the average household income in 2017 stood at $61,372.
17. Hispanic households had a median household income of $56,113 in 2019.
US income trends for 2019 suggest that even though poverty rates fell for all racial and ethnic groups, significant disparities still exist. The poverty rate among Hispanic households was 15.7% in 2019.
According to the last available data, the median Hispanic household earned 74 cents in 2019 for every dollar of the median white household.
18. US income stats reveal that the Caucasian median household income stood at $76,057 in 2019.
Caucasian (white not Hispanic) households had a relatively high median income in 2019. The racial and ethnic differences in median net worth are driven in part by differences in homeownership, education, and unemployment rate and by accumulated inequality and discrimination, as well as differences in power and opportunity.
The world’s phenomenon of income inequality is more present than ever. In recent years, the number of billionaires has increased, and their fortunes have reached record levels. However, the latest available data on the income growth by percentile across all world regions reveals that the top 1% did see an income reduction after the Great Recession. Starting at such a high base ensures that these reductions don’t present any significant change in fortune.
19. 56% of the world’s population lives on between $2 and $10 a day.
The history of income inequality shows that we are not facing a new phenomenon. It has reemerged as a social and political flashpoint in advanced economies in recent years, creating a vicious cycle of frustration, discontent, and inequality across generations.
20. According to data on wealth inequality in the world from 2020, the top 1% of households globally own 43% of all personal wealth.
The 2020 Credit Suisse Global Wealth report reveals that top-tier 1% amounts to 52 million people who are all millionaires in net wealth.
Within this elite fraction are 175,000 ultra-wealthy people with over $50 million in net wealth, or 0.1%, who in turn own 25% of the world’s wealth.
21. Countries by income inequality data suggest that in Russia in 2019, the top 10% seized a national income share equal to 46%.
Additionally, the top 10% national income in India rose to 56% and 41% in China. Meanwhile, the concentration of income in the US went up to 45% among the wealthiest 10%. The European region remains the most equal of all, with the top 10% earning over 35% of the national income.
22. The median household income in the UK was £29,900 in the financial year ending 2020.
In the last nine years, the median household income increased by 7%. However, the income growth of the poorest fifth fell by an average of 3.8% per year in the last three years. On the other hand, the median income of the wealthiest fifth continued to grow steadily, which means that some parameters that cause the income inequality increased over this period.
According to the Commerce Department, the household income rose 10% in January 2021 compared to the previous month. While helping households, the pandemic aid was also pouring money into the US economy, priming it for rapid growth this year. The increase was the second-largest on record, deprived only by last April’s gain when the federal government sent an initial round of pandemic relief payments.
However, the income inequality in the USA is higher than in almost any other developed country, and it is still growing. There are considerable wealth and income gaps across racial groups, and the COVID-19 pandemic has laid bare many of these disparities.
The average income measures the amount of money earned per person in a nation or geographic region for a given year. Dividing the country’s national annual income by its population gives an insight into the national average income.
Calculating the average yearly income means taking into account every woman, man, child and even babies as population members. This comes as a contrast to measuring other types of income, like household income which takes into account all occupants under one roof as a household.
Uneven distribution of income in the US has been present for decades. According to the latest available data on this topic, 46.51% of Americans have wage income lower than $30,000, while only 0.09% of Americans have a wage income higher than $1,000,000.
The middle class is minimal with only 22.27% of US citizens earning wage income between $50,000–$99,999 and around 20.93% between $30,000–$49,999.
The average net worth is calculated by adding together the net values of an entire group and dividing the result by the number of individuals within the group. However, the average net worth can be misleading without more context. That’s because the average net worth relies on a value known as the mathematical mean. Several tried-and-true methods for increasing net worth include paying down debt, reducing total liabilities, maximizing retirement contributions, cutting expenses, increasing income, and investing wisely.
There are 1.6 million American households that count as the top 1%. Billionaires, businessmen, and wealthy individuals are all part of this category, and some have wealth balances bigger than some nations’.
In 2010, Occupy Wall Street put the ‘’top 1%’’ term into the spotlight, branding the people that are part of this group as very influential and filthy rich. Ten years later, the top 1% are even more exclusive and prosperous and it seems that their fortune will just keep increasing.
The gap between the median wage in a state and the top 10% earned will always be significantly high. However, this gap varies widely depending on where people live. For example, living in New York or Washington, D.C., means that the earnings of individuals have to be four times the median income for them to crack the top 10%. In 2019, the top 10% of individual revenues started at $125,105.00 in the United States.
In 2020, about 28,092.101 workers, or 15.9% of all individual workers, made a six-figure income, and 3,942.367 workers, or 2.23% of the workforce, earned a quarter million or more revenue. According to the latest available US income statistics, 6% of workers, or around 10,535.29 people in the United States, made more than half-million in 2020.
Census, CNBC, CNBC, DQYDJ, Economic Policy Institute, Global Finance, Inequality.org, Knight Frank, NewRetirement, Office for National Statistics, Oxfam International, Seeking Alpha, Statista, Statista, Statista, Statista, The Balance, Trading Economics, TRT World, Visual Capitalist, World Inequality Database