According to Sentier Research, the median household income in the United States rose from $61,858 in May 2018 to $62,175 in June 2018, an increase of 0.5% over the previous month.
The following chart shows the nominal (red) and inflation-adjusted (blue) trends for median household income in the United States from January 2000 through June 2018, as given by Sentier Research's monthly estimates. The inflation-adjusted figures are presented in terms of constant June 2018 U.S. dollars.
That fast pace of growth is reflected in the year over year nominal growth rate for median household income, which we've visualized in the following chart.
The nominal rate of year over year growth for median household income has now equaled or exceeded 2.7% over the last 15 months. That duration exceeds the two longest durations of 2.7% or higher growth recorded since the Great Recession began after December 2007, which at thirteen months each, were recorded from February 2014 through February 2015, and later from August 2015 through August 2016.
Analyst's Notes
It's a big month for our alternative method for estimating median household income in the United States because the U.S. Bureau of Economic Analysis' data on personal income has just gone through an extensive revision, which is driving us to update our alternate estimates. The revision affects all of the BEA's data extending back to 1929.
The following chart shows our updated model for estimating the median household income in the U.S. Our basic methodology for generating the model remains unchanged, where we recognize a break in the data that is attributable to changes in the U.S. Census Bureau's questionnaire for collecting income data as part of its monthly Current Population Survey that was implemented in March 2015.
In terms of basic stats, for the period from January 2000 through June 2018, our alternate median household estimates are reliably within one standard deviation of Sentier Research's estimates for over 70% of the observations, are within two standard deviations for 95% of the observations, and are within three standard deviations for 99.5% of the observations.
Per the BEA's 30 July 2018 data revision, our previously reported estimate for May 2018 of $61,497 has been revised upward by $164 (or 0.27%) to $61,661. Our alternate method's estimate of U.S. median household income in the U.S. for June 2018 is $61,891, an increase of about 0.4% over the revised May 2018 estimate.
Data Sources
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. [PDF Document, Online Database (via Federal Reserve Economic Data)]. Last Updated: 30 July 2018.
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. [PDF Document, Online Database (via Federal Reserve Economic Data)]. Last Updated: 30 July 2018.
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 July 2018.
References
Sentier Research. Household Income Trends: January 2000 through May 2017, March 2018 through June 2018. [Excel Spreadsheet with Nominal Median Household Incomes for January 2000 through January 2013 courtesy of Doug Short]. [PDF Document]. Accessed 27 June 2018. [Note: We've converted all data to be in terms of current (nominal) U.S. dollars to develop the analysis presented in this series.]
Labels: math, median household income
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