Economy Watch: Poverty Rate Edges Down, Number of People in Poverty the Same
- Sep 17, 2014
The U.S. official poverty rate in 2013 was 14.5 percent, down from 15 percent in 2012, the Census Bureau reported on Tuesday. That’s because as the nation’s population grew, the number of people in poverty, according to the official definition at least, did not.
For the third consecutive year, the 45.3 million people living at or below the poverty line in 2013 didn’t represent a statistically significant change from the previous year’s estimate. As defined by the Office of Management and Budget and updated for inflation using the CPI, the average poverty threshold for a family of four in 2013 was income of $23,834 a year.
Median household annual income in the United States in 2013 was $51,939, a little up in real terms from the 2012 median of $51,759, but a movement the bureau calls “not statistically significant.” This is the second consecutive year that the annual change wasn’t statistically significant, following two consecutive annual declines, so perhaps post-recession stability in income is setting in.
The bureau also had other economic conditions to report. For instance, in spring 2007, before the recession, there were 19.7 million “shared” U.S. households, representing 17 percent of all households. By spring 2014, the number had increased to 23.5 million or 19.1 percent of all households. Shared households are those that include at least one “additional” adult: a person 18 or older who isn’t enrolled in school and isn’t the householder, spouse or cohabiting partner of the householder.
Also, in spring 2014, 6.1 million young adults age 25 to 34 (14.4 percent) lived with their parents. Neither the number nor percentage experienced a statistically significant change from 2013, the bureau notes.
PPI doesn’t move in August
Another sign of muted inflation: The Producer Price Index for final demand, which tracks wholesale prices, was unchanged in August, the Bureau of Labor Statistics said on Tuesday. Final demand prices advanced 0.1 percent in July and 0.4 percent in June. The index for final demand increased 1.8 percent for the 12 months ended in August.
A 0.3 percent rise in prices for final demand services in August offset a 0.3 percent decrease in the index for final demand goods, rendering the movement of the overall PPI zero. The drop for final demand goods was the largest decrease since a 0.7 percent decline in April 2013. Over 80 percent of the August decline was because wholesale prices for energy fell 1.5 percent.
On a more granular level, wholesale prices for natural gas, chicken eggs, diesel fuel, electric power and raw cotton also moved lower, as did health, beauty, and optical goods. On the other hand, the index for potatoes surged 28 percent. Prices for wholesale pharmaceutical preparations and jet fuel also advanced.
Wall Street bounded upward on Tuesday, with the Dow Jones Industrial Average advancing 100.83 points, or 0.59 percent. The S&P 500 and the Nasdaq were both up 0.75 percent.