U.S. Incomes Declined More During Recovery Than In Recession: Study

The U.S. economy may technically be in a recovery, but it likely doesn’t feel that way for many Americans when grabbing for their wallets.

Median annual household income has fallen more during the recovery than it did during the recession, according to a new study from former Census Bureau officials Gordon Green and John Code. Between December 2007 and June 2009, when the U.S. economy was in recession, incomes declined 3.2 percent. While during the recovery between June 2009 and June 2011 incomes fell 6.7 percent, the study found.

The lack of income growth may explain why for most Americans the recovery still feels like a recession. Eight in 10 Americans believe the recession is an ongoing problem, according to a recent Gallup poll. And workers don't anticipate things will pick up any time soon. Nine out of 10 Americans said they don't expect to get a raise that will be enough to compensate for the rising costs of essentials like food and fuel, according an American Pulse survey released in June.

Slow job growth is likely also exacerbating the feelings of recession and weighing on household incomes. U.S. employers added 103,000 jobs in September, too few jobs drive the unemployment rate below 9.1 percent and barely enough to keep pace with population growth, the Department of Labor reported last week. Those Americans that are employed are continuing to get squeezed by their employers. Profits per employee went up for the second year in a row in 2010, according to financial analysis company Sageworks.

If the U.S. continues its sluggish jobs growth pace it could drive incomes even lower. Americans who are jobless for more than 99 weeks lose any unemployment benefits driving their incomes to zero and weighing on the national average, according to 24/7 Wall Street.

The recession’s and the recovery’s drag on income growth has put some Americans in a worse position than they were decades ago. The median income for U.S. males was worse in 2010 than in 1968 on an inflation-adjust basis.

In some states the recession and the recovery only exacerbated a decline in incomes that’s been taking place for longer. The median household income in Wisconsin plunged 14.5 percent between 1999 and 2010, The Milwaukee Wisconsin Journal Sentinel reported.

If union membership continues to decline in states like Wisconsin, incomes may keep falling. A boost in union membership would increase middle-class incomes by more than $1,000, a bump that would be more than if the unemployment rate fell by four percent, according to the Center for American Progress.

Still, even if Americans are forced to continue to watch their incomes dwindle the U.S. economy won’t necessarily get pushed back into a recession. Recent data including last week’s jobs report indicates that the economy is growing slowly, not contracting, Bloomberg reported.

Comments

[kgb999]

06:15 PM on 12/02/2011

If 9 out of 10 Americans are worse off in "recovery" than they were in "recession" .... methinks this word they keep using, "the economy," doesn't mean what they think it means.

Can we all agree that rich people making more money than they every have in history does not count as ending a recession?

[M Grey]

03:42 PM on 11/09/2011

"U.S. Incomes Declined More During Recovery Than In Recession: Study"

It's funny how blind people can be to reality.
I'm falling upward!
If incomes declined there is no recovery, we're sinking into further recession.

[xanas]

11:01 AM on 10/28/2011

This article should explain what is wrong with the view of the economy based on the GDP, and the absolutely failed prescription of Keynesian economics to continue monetary and fiscal stimulus. Instead of building the real economy their drug destroys the economy to serve a stupid number.

Whenever your car is wrecked and you call up the insurance company GDP increases, yet one cannot say that we have gained wealth.

The economy has grown weaker and weaker as bailouts have continued over these last generations. We need to end corporate welfare and get back to improving the real economy by eliminating the state interventions that have caused this mess.

http://www.youtube.com/watch?v=jvH4YlpCGSo
http://www.youtube.com/watch?v=GTQnarzmTOc

[madame48]

01:36 AM on 10/12/2011

just in my extended family...the ones who were laid off got jobs at lower wages AND the ones who still had jobs were handed enough extra work to do that another hiree was really needed. easier to make 1 person do the work of 2, for little or no extra $$...let's be realistic..companies are squeezing emplyees as much as they can. one company hired some consuktant to come in and analyze just how little the company could offer the scientists there for raise before they would jump ship...they PAID lots to do that, that they could have paid these workers. So, they ended up losing several just in that one area. I don't know what they are teaching in business schools these days, but it is stupid & bad for the country

[pappyvet]

06:01 PM on 10/11/2011

Recovery? really?

[fiann39]

06:01 PM on 10/11/2011

I don't know why the Republicans are harping about lowering taxes. According to this article, we're all paying 6.7% less taxes to the government already, and since that's the case, the Democrats want to raise taxes on the filthy rich (well, they'd like to raise taxes on all of us, but the filthy rich is an easy sell).

[Jesster]

10:43 PM on 10/11/2011

The public - Dems & GOPers alike have thrown their support behind this common sense solution (as PART. not ALL of a plan to lower debt and deficit spending) It's the actual Repugs in Congress (you know, our well paid and benefitted employees) who are vehemently against it mainly because they see it as a way to hurt Obama (and don't care about the rest of us at all.)

It's criminal really and shows utter contempt for the people they're elected to serve.

[Botany5000]

03:20 PM on 10/11/2011

How Progressive!!!!

[opinionhead]

11:35 AM on 10/11/2011

No surprise here.... A totally "Free" Market Capitolism where government provides no services and no regulations. A government whose representatives are open to the largest bidder. A place where the corporate "news" media is used to sway votes instead of provide the news.

So after 30 years the US is waking up to the fact that this "Free Market Capitolism" only feels free for the corporations and 1%.

[Botany5000]

03:21 PM on 10/11/2011

Buried in paper is the problem.

[eelnivek53]

10:59 AM on 10/11/2011

Lets send more jobs overseas...Obama....

The United States has long been the home to cutting-edge innovations in the medical device industry. However, increasingly burdensome regulatory policy is driving pioneering research and development to Europe and the rest of the world. Nevertheless, the U.S. Food and Drug Administration (FDA) and self-styled public health advocates are engaged in an assault on the primary regulatory pathway through which new products reach the market.

The primary law governing medical devices, enacted in 1976, established a flexible review process intended to tailor FDA oversight of new and improved devices to a level of regulatory control sufficient to provide a reasonable assurance of safety and effectiveness.

Most new devices incorporate fairly modest changes or improvements on previously marketed ones. For that reason, an estimated 90 percent or more of the devices now on the market have been authorized for commercial sales through what is known as the 510(k) process.

The FDA recently proposed additional changes that would make the 510(k) review even more onerous, and a report from the Institute of Medicine has called for scrapping the 510(k) process altogether. Arguably the most stinging safety criticism that can be made against the FDA is not that the 510(k) clearance process is flawed per se, but that the agency has mismanaged it by occasionally clearing devices that were not in fact substantially equivalent to predicate devices.

[cog702]

10:41 AM on 10/11/2011

It's past time for uncorrupted congressmen to brush off the anti-trust act and start busting some of these to big to fail companies back to a local level... That in it's self would create jobs.

Or is it there are NO UNCORRUPTED CONGRESSMEN LEFT?

[cog702]

10:38 AM on 10/11/2011

And Cain wonders why the working people are pissed??

With his attitude he must be a reincarnation of the original Cain.

[davein fwb]

09:40 AM on 10/11/2011

What's sad is people say "get to work" well if it were that easy I would be able to get a loan for a newer truck. I'm self employed have been for 8 years, don't have any debt and have money to put down but banks won't lend to me because I'm self employed. To add insult to injury....every time they look at my credit score I get points taken off because of it! How rediculous is that? I think the whole entire banking industry needs to be shaken up and the big banks needed to go bankrupt when they were broke.

[Dr JAY Veeoh]

09:28 AM on 10/11/2011

There never was a recovery ?

[e081194eng]

09:17 AM on 10/11/2011

The Tea Party has organized, peaceful demonstrat­ions while the fruitloop libs on Wall Street and other places are running around peeing everywhere­, leaving garbage all over the place, throwing shoes at the cops, getting arrested and accomplish­ing absolutely nothing. No wonder they don't have jobs, they're too busy running around, crying that nothing is being handed to them on silver platters and blaming people for being successful­.

[Protocolor]

04:51 PM on 10/11/2011

Wrong. The Tea Baggers have nice peaceful demonstrations that are thoroughly controlled by big business spin masters. The baggers are no threat to big business as usual, so the media loves them (even if the baggers are profoundly ignorant) and the cops don't feel compelled to mace them.

[e081194eng]

11:02 PM on 10/11/2011

That's because you libs are clueless.

[M Grey]

03:45 PM on 11/09/2011

Media loves the TP? Not from what I've read.

[scottwarhar]

09:09 AM on 10/11/2011

Corporate executives,wall street traders,wall street bankers,fund managers,and the rest of the higher financial people all saw their incomes rise.Americans workers saw their wages stagnate or fall and prices rise.The money was distributed to the top and taken from the bottom.American workers live in the threat of outsourcing even as their productivity rises.The only companies building in America are foriegn countries for our cheap well trained efficient work force as our companies build oveseas and profit twice on the money they invest.They subsidize gaining market share abroad by charging less for customers over there and raising prices over here.Somebody in America must start to invest in American manufacturing again or we will lose all our wealth as a nation because the paper factories of wall street only produce paper wealth for those that run it.