The headlines regarding last week’s release of new Census economic data were largely glowing: “U.S. middle-class incomes reached highest-ever level in 2016,” read one. “New Jersey household incomes up a strong 4 percent in 2016,” said another said.
There certainly was plenty of good news to be found in the report. Nationally, median household income rose to $59,039 in 2016, a 3.2 percent increase from the previous year and the second straight year of healthy gains. The poverty rate fell to 12.7 percent, close to what it was prior to the start of the 2007 financial crisis. And another Census report showed that the number of Americans without health insurance reached its lowest level ever.
New Jersey’s inflation-adjusted 4 percent increase in household income last year was the third-highest in the U.S. A year earlier, incomes in New Jersey were essentially flat — poor enough to rank last in the nation. Positive economic news has been missing from New Jersey for far too long. But some groups, and some areas of the state, are still being left behind.
In New Jersey, as elsewhere in the country, the gains were very uneven. While all income groups nationally showed gains, inequality increased. New Jersey had a far higher percentage of high-income households than the nation as a whole. Households with incomes of at least $100,000 increased about 5 percent, from 1.17 million to 1.23 million. Nearly 40 percent of the state’s households now have incomes of $100,000 or more. Those with incomes of at least $200,000 jumped 11 percent, from about 346,000 to 383,000. That’s about one in eight households.
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Good news indeed. But deeper reads into the stories were less encouraging. After accounting for inflation, the typical income in New Jersey and the nation as a whole remained behind peaks reached in 2000. And inequality widened. The top fifth of earners accounted for more than half of all overall income, a record high. The median African American household earned only $39,490, compared with more than $65,000 for whites and over $81,000 for Asians. Roughly half a million households — or one in six in the state — had annual incomes of less than $25,000.
In New Jersey, there also were wide geographic disparities. The median household income in Hunterdon County of $113,684, for instance, was nearly double that of Ocean County ($62,222) and more than double that of Salem and Cumberland counties. According to New Jersey Policy Perspective, while the state’s poverty rate fell 0.4 percent to 10.4 percent, the rate is still 21 percent higher than it was in 2007. New Jersey’s child poverty also dropped slightly —– to 14.6 percent — but remains 26 percent higher than it was a decade ago. The federal poverty threshold is $19,318 for a family of three and $24,339 for a family of four.
The numbers should prompt policymakers to take a fresh look at what can be done to ensure that those on the lower economic rungs in New Jersey are given every opportunity to improve their economic standing. Where to begin? It all starts with educational opportunities, giving people the tools they need to succeed in the workplace, and policies that stimulate jobs in cities and rural areas suffering from high unemployment rates.
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