The Federal Reserve’s Survey of Consumer Finance (SCF) findings for 2013 are just out. It will take a bit to absorb them all—this is a rich data set with data not just on income, but on wealth as well, including debt. That makes it a key source for information on household net worth.
But I was initially struck by two figures from the report. The first one below is for income, and shows changes in real mean and median income over two periods, 2007-10, basically the Great Recession, and 2010-13, the first few years of recovery.
Unsurprisingly, both measures fell hard in the recession, as income losses occurred throughout the scale. But over the recovery, mean income rose about 4% while the median fell by 5%. That’s a very familiar pattern in a period of unequal gains.
In fact, the mean income of the bottom fifth of households fell 4% while that of the richest fifth rose 6% (and the income of the top tenth rose by 10%). So, here’s yet another indicator of where the growth is going.
Turning briefly to net worth—like I said, I’ll have more to say about this later—real median net worth took a big hit in the downturn and has yet to start climbing back. It’s down 30% since 2001, and 40% off its 2007 peak.
Not pretty pictures, I know. But if you want to understand a) the extent to which inequality is reasserting itself since the downturn, and b) the losses in wealth to middle-class families (and perhaps why many still feel pretty damn grumpy), you’ve got to look at them.