Except for rich, Americans' incomes fell last year
Most Americans' incomes continued to fall last year, but the richest 20% saw theirs rise, a new Labor Department report showed Thursday.world Updated: Apr 03, 2015 13:08 IST
Most Americans' incomes continued to fall last year, but the richest 20% saw theirs rise, a new Labor Department report showed Thursday.
In fresh data that adds fire to a growing debate over about income inequality, the department said that Americans on average saw income decline for the second straight year in the 12 months to June 2014.
The average pre-tax income fell 0.9% from the same period a year earlier, to $64,432.
But broken down into quintiles, those in the top 20% of incomes saw their money stream grow by 0.9% to $166,048 on average.
Every other group lost ground, with the bottom 20% losing the most: their average income dropped 3.5% to $9,818.
Those losses came despite an economy that was picking up pace and generating well over 200,000 jobs a month last year.
While the majority of incomes fell, consumer spending, which accounts for about two-thirds of US economic activity, rose 1.0% on average.
The largest increase was an 11.3% rise in healthcare spending, which has climbed every year since 1996, to an average of $3,919.
Housing expenditures rose 2.0% to $17,377.
The new data added further evidence of the widening disparity between the rich and the rest of Americans, an issue that is stirring growing concerns as the economy strains to recover from the Great Recession caused in part by Wall Street excesses.
Federal Reserve Chair Janet Yellen repeatedly has raised the issue.
On Thursday, at a Fed conference on economic and social mobility in Washington, Yellen emphasized that "roughly 80% of Americans across the ideological spectrum see inequality as a moderately big or very big problem," according to her prepared remarks.