Political Calculations' initial estimate of median household income in March 2023 is $81,340, an increase of $447 (or 0.6%) from the initial estimate of $80,893 in February 2023.

Adjusted for inflation, the level of median household income in March 2023 represents a $182 increase over February's estimate, with earned income outpacing consumer price inflation during the month. March 2023 represents a new record peak for median household income.

The latest update to Political Calculations' chart tracking Median Household Income in the 21st Century shows the nominal (red) and inflation-adjusted (blue) trends for median household income in the United States from January 2000 through March 2023 The inflation-adjusted figures are presented in terms of constant March 2023 U.S. dollars.

Since we haven't featured it in a while, here's the updated picture for averge individual earned income during the Biden era:

After having significantly decelerated in the first half of 2022, nominal earned wage and salary income per capita grew slightly faster in the second half, which has continued through the first quarter of 2023. Unfortunately, inflation-adjusted personal income has generally stayed below its December 2021 peak.

Analyst's Notes

There were minimal revisions in the BEA's historic aggregate wage and salary data this month, only affecting the data for January 2023 (-0.009%) and February 2023 (-0.021%).

References

U.S. Bureau of Economic Analysis. Table 2.6. Personal Income and Its Disposition, Monthly, Personal Income and Outlays, Not Seasonally Adjusted, Monthly, Middle of Month. Population. [Online Database (via Federal Reserve Economic Data)]. Last Updated: 28 April 2023. Accessed: 28 April 2023.

U.S. Bureau of Economic Analysis. Table 2.6. Personal Income and Its Disposition, Monthly, Personal Income and Outlays, Not Seasonally Adjusted, Monthly, Middle of Month. Compensation of Employees, Received: Wage and Salary Disbursements. [Online Database (via Federal Reserve Economic Data)]. Last Updated: 28 April 2023. Accessed: 28 April 2023.

U.S. Department of Labor Bureau of Labor Statistics. Consumer Price Index, All Urban Consumers - (CPI-U), U.S. City Average, All Items, 1982-84=100. [Online Database (via Federal Reserve Economic Data)]. Last Updated: 12 April 2023. Accessed: 12 April 2023.

Image credit: Photo by Alexander Grey on Unsplash.

Political Calculations' initial estimate of median household income in February 2023 is $80,893, an increase of $453 (or 0.6%) from the initial estimate of $80,440 in January 2023.

Adjusted for inflation, the level of median household income in February 2023 represents a $16 increase over January's estimate. Both January and February's estimates fall below December 2022's record peak.

The latest update to Political Calculations' chart tracking Median Household Income in the 21st Century shows the nominal (red) and inflation-adjusted (blue) trends for median household income in the United States from January 2000 through February 2023 The inflation-adjusted figures are presented in terms of constant February 2023 U.S. dollars.

Analyst's Notes

After last month's substantial revisions, the Bureau of Economic Analysis' latest revisions of its aggregate income data were miniscule. The BEA's aggregate wage and salary income estimates were revised downward from October 2022 (-0.002%), November 2022 (-0.003%), December 2022 (-0.078%) and January 2023 (-0.081%).

In March 2023, the Federal Reserve Bank of Atlanta substantially revised its monthly estimates of median household income from December 2013 through December 2022, bringing them more in line with our estimates during much of this period. We'll take a more detailed look at those changes later this month. As a teaser, there's still a big difference in the visible trends between their modeled estimates and ours in the period since March 2021.

Meanwhile, the U.S. Census Bureau conducted the survey for its Annual Social and Economic Supplement (ASEC) of its Current Population Survey (CPS) during March 2023. The Census Bureau's analysts will be assessing that new income data during the next several months. They are expected to release their annual estimate of median household income for 2022 sometime in September 2023.

References

U.S. Bureau of Economic Analysis. Table 2.6. Personal Income and Its Disposition, Monthly, Personal Income and Outlays, Not Seasonally Adjusted, Monthly, Middle of Month. Population. [Online Database (via Federal Reserve Economic Data)]. Last Updated: 31 March 2023. Accessed: 31 March 2023.

U.S. Bureau of Economic Analysis. Table 2.6. Personal Income and Its Disposition, Monthly, Personal Income and Outlays, Not Seasonally Adjusted, Monthly, Middle of Month. Compensation of Employees, Received: Wage and Salary Disbursements. [Online Database (via Federal Reserve Economic Data)]. Last Updated: 31 March 2023. Accessed: 31 March 2023.

U.S. Department of Labor Bureau of Labor Statistics. Consumer Price Index, All Urban Consumers - (CPI-U), U.S. City Average, All Items, 1982-84=100. [Online Database (via Federal Reserve Economic Data)]. Last Updated: 14 March 2023. Accessed: 14 March 2023.

Image credit: Household Income by Nick Youngson. Creative Commons 3 - CC BY-SA 3.0 Alpha Stock Images.

Political Calculations' initial estimate of median household income in January 2023 is $80,440, an increase of $1,035 (or 1.3%) from the initial estimate of $79,405 in December 2022.

That's a substantial increase, but over half of the positive change we're reporting is the result of the Bureau of Economic Analysis' upward adjustments of aggregate income data earned in each month during the second half of 2022. For reference, the revised nominal estimate for December 2022 is $79,939, which accounts for $534 (or 51.6%) of the change from our original estimate.

These changes are incorporated in the latest update to Political Calculations' chart tracking Median Household Income in the 21st Century reflects the results of that revision, showing the nominal (red) and inflation-adjusted (blue) trends for median household income in the United States from January 2000 through January. The inflation-adjusted figures are presented in terms of constant January 2023 U.S. dollars.

Adjusted for inflation, December 2022's estimated median household income still represents a new record peak for this demographic characteristic, with real median household income falling because of a surge in January 2023's reported level of inflation.

The data revisions also affect the estimate of average personal income. At $34,987, January 2023's nominal median household income represents a new record high for this measure, which also exceeds its previous inflation-adjusted peak from December 2021.

This month's aggregate income revisions follow last month's substantial upward revisions of U.S. population estimates. Those revisions had effectively lowered our estimates of median household income and average personal earned income. This month's significant upward income revisions from July through December 2022 reverse much of that effect.

Analyst's Notes

We can most easily see the net impact all these revisions by comparing the updated nominal average personal income estimate for November 2022 with our original estimate for this month, prior to the population and aggregate income revisions. Our original estimate of November 2022's average personal earned income was $34,231, our revised estimate is $34,563, an increase of $332 (or +0.1%).

That small result compared to the large change we're seeing for January 2023's estimate suggests a significant acceleration for American income growth in the new year. Following the substantial data revisions we've seen during the past two months, we anticipate much smaller revisions for both population and aggregate income in the months ahead.

References

U.S. Bureau of Economic Analysis. Table 2.6. Personal Income and Its Disposition, Monthly, Personal Income and Outlays, Not Seasonally Adjusted, Monthly, Middle of Month. Population. [Online Database (via Federal Reserve Economic Data)]. Last Updated: 24 February 2023. Accessed: 24 February 2023.

U.S. Bureau of Economic Analysis. Table 2.6. Personal Income and Its Disposition, Monthly, Personal Income and Outlays, Not Seasonally Adjusted, Monthly, Middle of Month. Compensation of Employees, Received: Wage and Salary Disbursements. [Online Database (via Federal Reserve Economic Data)]. Last Updated: 24 February 2023. Accessed: 24 February 2023.

U.S. Department of Labor Bureau of Labor Statistics. Consumer Price Index, All Urban Consumers - (CPI-U), U.S. City Average, All Items, 1982-84=100. [Online Database (via Federal Reserve Economic Data)]. Last Updated: 14 February 2023. Accessed: 14 February 2023.

Image credit: Photo by Kostiantyn Li on Unsplash.

Political Calculations' initial estimate of median household income in December 2022 is $79,405, an increase of $193 (or 0.2%) from the initial estimate of $79,212 in November 2022.

The latest update to Political Calculations' chart tracking Median Household Income in the 21st Century reflects the results of that revision, showing the nominal (red) and inflation-adjusted (blue) trends for median household income in the United States from January 2000 through December 2022. The inflation-adjusted figures are presented in terms of constant December 2022 U.S. dollars.

Adjusted for inflation, December 2022's estimated median household income represents a new record peak for this demographic characteristic, exceeding the revised December 2021's previous peak by $1,499. We also observe the effect of inflation continues to be muted, coinciding with the substantial decline in oil prices since the early June 2022. That decline has offset the effect of other rising prices, where increases in the cost of food has been significant.

Taking a step back to look at the average personal income earned by individual Americans, we find their inflation-adjusted income has not yet recovered to its December 2021 level.

Zooming in to look just at the Biden era, we see that nominal earned income growth slowed considerably after December 2021.

Adjusted for inflation, personal earned income growth shrank in the first half of 2022 before bottoming in June 2022, coinciding with the nation's technical recession. It grew at a relatively steady rate in the second half of 2022.

Analyst's Notes

The U.S. Census Bureau released updated population estimates extending back to March 2020. These changes were both positive and progressively substantial. By positive, we mean that all estimates were increased over their previously reported level. By progressively substantial, we mean that the smallest adjustment (+1,000) was made for March 2020, with most months seeing a progressively larger upward adjustment ending with November 2022 seeing the biggest increase (+744,000). That's a substantial change.

By contrast, the BEA made minor downward adjustments to its aggregate wage and salary data for only the months of October 2022 (-0.1%) and November 2022 (-0.3%).

The combined effect of these changes is most notable for November 2022. As noted earlier, our pre-revision median household income estimate for month was $79,212. November 2022's estimate fell by $135 (-0.2%) to $79,077 after these revisions superseded the previous data. Revisions in our estimates of median household income for the other months from March 2020 through October 2022 are smaller.

During March 2023, the U.S. Census Bureau will collect survey data from roughly 75,000 households for its Annual Social and Economic Supplement. It will take nearly six months to analyze the data it compiles before presenting its annual estimate of the U.S. median household income for the 2022 calendar year on Friday, 8 September 2023.

References

U.S. Bureau of Economic Analysis. Table 2.6. Personal Income and Its Disposition, Monthly, Personal Income and Outlays, Not Seasonally Adjusted, Monthly, Middle of Month. Population. [Online Database (via Federal Reserve Economic Data)]. Last Updated: 27 January 2023. Accessed: 27 January 2023.

U.S. Bureau of Economic Analysis. Table 2.6. Personal Income and Its Disposition, Monthly, Personal Income and Outlays, Not Seasonally Adjusted, Monthly, Middle of Month. Compensation of Employees, Received: Wage and Salary Disbursements. [Online Database (via Federal Reserve Economic Data)]. Last Updated: 27 January 2023. Accessed: 27 January 2023.

U.S. Department of Labor Bureau of Labor Statistics. Consumer Price Index, All Urban Consumers - (CPI-U), U.S. City Average, All Items, 1982-84=100. [Online Database (via Federal Reserve Economic Data)]. Last Updated: 12 January 2023. Accessed: 12 January 2023.

Political Calculations' initial estimate of median household income in November 2022 is $79,212, an increase of $399 (or 0.5%) from the initial estimate of $78,813 in October 2022.

The latest update to Political Calculations' chart tracking Median Household Income in the 21st Century reflects the results of that revision, showing the nominal (red) and inflation-adjusted (blue) trends for median household income in the United States from January 2000 through November 2022. The inflation-adjusted figures are presented in terms of constant November 2022 U.S. dollars.

Adjusted for inflation, November 2022's estimated median household income represents a new record peak for this demographic characteristic, exceeding the December 2021's previous peak by $1,031. The chart also confirms the effect of inflation has been muted since June 2022, coinciding with a 35% decline in oil prices since the start of that month. That the overall effect of inflation during these months has been so muted is the result of other prices rising to offset the reduction in oil and fuel prices.

Analyst's Notes

The BEA made very small, nearly unremarkable adjustments to its aggregate wage and salary data for the months of July through October 2022.

Looking forward, we will present our initial estimate for December 2022's median household income on 1 February 2023. Meanwhile, the U.S. Census Bureau will collect survey data from roughly 75,000 households for its Annual Social and Economic Supplement during March 2023, presenting its estimate of the U.S. median household income for the 2022 calendar year sometime in September 2023.

References

U.S. Bureau of Economic Analysis. Table 2.6. Personal Income and Its Disposition, Monthly, Personal Income and Outlays, Not Seasonally Adjusted, Monthly, Middle of Month. Population. [Online Database (via Federal Reserve Economic Data)]. Last Updated: 23 December 2022. Accessed: 23 December 2022.

U.S. Bureau of Economic Analysis. Table 2.6. Personal Income and Its Disposition, Monthly, Personal Income and Outlays, Not Seasonally Adjusted, Monthly, Middle of Month. Compensation of Employees, Received: Wage and Salary Disbursements. [Online Database (via Federal Reserve Economic Data)]. Last Updated: 23 December 2022. Accessed: 23 December 2022.

U.S. Department of Labor Bureau of Labor Statistics. Consumer Price Index, All Urban Consumers - (CPI-U), U.S. City Average, All Items, 1982-84=100. [Online Database (via Federal Reserve Economic Data)]. Last Updated: 13 December 2022. Accessed: 13 December 2022.