8 ms·

Since '67, households making $150K+ (inflation adjusted) grew from 1.8 to 23.8M

32 points by KoftaBob 4y ago

CM30 4y ago
Wonder how many of these households are in the Silicon Valley area? Feels like wages at large tech companies have skyrocketed in the last few years, and could reach this number quite easily.
- MontyCarloHall 4y ago
  No. The entire Bay Area is home to about 8M people, of which approximately 10% are tech workers [0]. This is a drop in the bucket across all 23.8M high earning American households. [0] https://www.mercurynews.com/2019/06/14/tech-employment-bay-area-reaches-record-highs-google-apple-facebook-adobe/amp/ https://www.mercurynews.com/2019/06/14/tech-employment-bay-a...
HWR_14 4y ago
Are we just quoting people who make stuff up now? I tried reading his source and that's not what the numbers there say. His '67 numbers are too low, his current numbers too high. Although maybe I misread the original data he links to. If so, please let me know.
brianwawok 4y ago
I wonder how much of this chart can be explained by "California/New York City". What's the same chart look like for a random state in the Midwest?
- andrekandre 4y ago
  definitely, i suspect you would see very different distributions... simplified charts like those hide a lot of important details also, how significant is income actually? how about total wealth? whats the debt level at each of these gradations etc?
j7ake 4y ago
There is also a larger fraction Of households where both parents work compared to 50 years ago
ethagknight 4y ago
Assuming for now that this graph is accurate from US census data, the graph really flies in the face of the “disappearing middle class.” The authors follow-up tweet about African-American earnings is also interesting, similar results.
- brianwawok 4y ago
  Right. For sure if you look at the data I think the biggest increases have been the .1% and the .01%. The drop in poverty is really good, and something our negativity biased news organizations are happy to skip. There have been some great human improvements over the past 50 years.
ren_engineer 4y ago
alternative title: Number of dual income families in the US with both parents forced to work to survive increased since 1967, while also working longer hours don't piss on my boot and tell me it's raining, almost every observable metric shows living standards have dropped significantly in the US over the past few decades
- abduhl 4y ago
  I’d be interested in seeing these metrics and how they quantify living standards. Does living standard mean “keeps pace with the average <standard> at a given time” or does it mean “given a specific objective <standard>“? For example, when I was a kid having cable television went from not standard when I was in elementary school to standard by the time I entered high school. Similarly: internet access, cell phones, having a computer, having a laptop, etc. This was true even outside of tech: having more than one car, having central air AC, having your own bedroom, taking the bus to school or being driven, and even having a bike evolved as I grew up.
- wfhordie 4y ago
  And it's all downhill from here. With the collapse of globalization, everything will become cheaper, slower, worse quality, and harder to get.
  - bergenty 4y ago
    Globalization will not collapse. As long as we have free and open trade nothing is really going to kill it.
    - wfhordie 4y ago
      >As long as we have free and open trade nothing is really going to kill it. I've got some really bad news for you, friend. The free trade era is already over and demographic collapse is coming for almost everyone. https://foreignpolicy.com/2021/07/20/free-trade-dead-managed-carbon-border-tax-climate-tariffs-trade-war-protectionism-esg-biden-trump-eu-china/ https://foreignpolicy.com/2021/07/20/free-trade-dead-managed...
gedy 4y ago
"...because they need two incomes to pay for what one used to cover."
pjdemers 4y ago
Back in the 60's, many full time jobs came with a defined benefit pension. Health care was not nearly as expensive, even without insurance. Last, houses were cheap, college was almost free, and there were many more good public schools, so living in the very best school districts wasn't as important. In other words, many of the things that today's households making > $150k spend money on were vastly cheaper.
- rayiner 4y ago
  I call this sort of reasoning the "Wonder Years" fallacy. People forget that the “middle class family” in "The Wonder Years" show--headed by a man who graduated college and a woman who completed some college--would have been a solidly top 10% family in 1970. Since 1970, the poverty rate among seniors has dropped from almost 25% to just above 10%: https://sgp.fas.org/crs/misc/R45791.pdf https://sgp.fas.org/crs/misc/R45791.pdf. Although more people had pension plans (though never a majority), they were not portable, and most workers never stayed at a job long enough to earn their pension. Pension benefits were also low compared to what they are now. See: https://retirementlc.com/golden-age-pensions-another-fairy-tale https://retirementlc.com/golden-age-pensions-another-fairy-t... Healthcare was cheaper in 1970, but because doctors could not do much for you if you got heart disease or cancer or other chronic illnesses. In 1970, 40% of heart attack patients who were hospitalized died. Today, it is well under 10%. Living longer doesn’t happen automatically, it costs money. Not just to develop heart medication or cardiac stents, but for the decades of additional care that is required when a heart attack patient survives to old age instead of dying at age 55. It’s not just old people either. The infant mortality rate has dropped from 26 per 1,000 in 1960 to under 6 per 1,000 in 2020. That wasn’t from cheap interventions like vaccination, which happened a generation before that. It was from expensive interventions like giving birth in hospitals, extensive pre-natal care, surgical interventions for sick infants, etc. The costs per square foot of new houses has stayed pretty much the same from 1970 to 2015: https://fee.org/articles/new-homes-today-have-twice-the-square-feet-per-person-as-in-1973 https://fee.org/articles/new-homes-today-have-twice-the-squa.... What people overlook is that (1) as the population grows, the "frontier" of where the typical new house is being sold moves; and (2) people are using their growing income to buy much bigger houses. For example, Silicon Valley was an underpopulated, undesirable suburban and rural area in the 1960s—that’s why they built semiconductor facilities there! It’s important to account for both price increases (paying more for the same thing) and consumption increases (paying more to get more). A good example of both of those things happening is college. The cost of college has undoubtedly gone up faster than inflation. But it’s also a very different product than it was in 1970, with fancy housing and recreational facilities and tons of handholding from support staff. By contrast, housing is a good example of something where it’s been mainly consumption increases. People are taking all their extra income and using it to buy bigger houses in more desirable areas.
missedthecue 4y ago
I'm surprised how many commenters here seem frustrated by this news.
- refurb 4y ago
  For whatever reason positive news tends not to play well on HN, even if it’s factual. But on another point, I recall that the entry of women into the workforce was almost complete by the 70’s so moving from one to two earner household isn’t likely the main driver.
  - wfhordie 4y ago
    >For whatever reason positive news tends not to play well on HN, even if it’s factual. People on HN are very good and detecting when someone is trying to blow sunshine up their ass. Take, for example, the second part of this tweet: >Very poor households (< $25K) shrunk from 24.7% to 18.1% (number rose slightly) That is an abject failure of an economy if I even saw one. 18.1% of households in the most embarrassingly rich country in the history of the planet are living in abject poverty? Even with what you can do with poverty wages nowadays, that fucking sucks. This rate should be <1%.
    - CodeSgt 4y ago
      By no means are 18.1% of the population living in "abject" poverty. They're living in what the US government classifies as poverty, but in the majority of these cases they still have a home, have food, have electricity, etc. I'm not saying that they're living comfy lives, but when you throw around terms like "abject povery" you're really discrediting people who are actually living in abject poverty. What are your plans to get the rate below 1%? What would you have done differently that wouldn't have wrecked the economy?
      - wfhordie 4y ago
        Ah, I love this game. It's the same one that the super-rich use to convince people barely scraping by -- or anyone who hasn't read Barbara Ehrenreich -- that you should zoom out far enough so that your situation is compared to literal kids with literal flies on their eyeballs. Your life ain't that bad, why you complainin'? The fact is, this country could fund universal childcare, universal healthcare and universal education from K-16 and not 'wreck the economy.' All it would take is doing what every other industrialized first-world country has done... and done better, with less resources. And don't worry, the people who you think are actually living in abject poverty aren't reading on HN on a Monday afternoon, so my discredit of their situation will go largely ignored.
Mikeb85 4y ago
This stat is apparently adjusted for inflation but is it adjusted for housing costs specifically?
- phendrenad2 4y ago
  Good point. It's really hard to adjust for inflation. On one extreme you can use the official inflation numbers, which are lies and damned lies to make the economic progress since the 1960s look better than it is. On the other extreme you can use housing prices. The truth (inflation as felt by the average household) is probably somewhere in-between.
notch656a 4y ago
I think these studies failed to take into account the labor value of the individual (typically wife) who would have been home. And even better, that labor isn't taxed.
- kwatsonafter 4y ago
  This is an actual and not news-of-the-day topical Liberal, "gotcha." America's wealth is in Her moms! Great comment. God bless Peggy Seeger & Family!
photochemsyn 4y ago
Here's a more useful source of data, including both raw and CPUI-inflation-adjusted numbers: > "On this page is the United States average household income by year and median household income by year between 1968 and 2021. You'll also find the top 1% household income by year between 1996 and 2021, plus the top 5% and 10% for the full range. It's the newest data to this point in 2022." https://dqydj.com/household-income-by-year/ https://dqydj.com/household-income-by-year/ Some takeaways (inflation-adjusted) (1) the median (half above/ half below) is mostly flat over the whole period, with a slight increase about 55K - 65K; anyone near or below this is almost surely a renter with little if any savings working paycheck-to-paycheck if that, and no retirement other than Social Security and maybe a small pension. (2) the top 5% has gone from 150K to 275K, this is probably mostly the white-collar professional sector who own their own homes (the top 10% mirrors this only from 125K to 200K). This probably encompasses well-sized 401K retirement accounts. (3) the top 1% bounces around 500K, although that data is only tracked since the mid 1990s, and seems to track things like 2001 dot com bust, 2008 subprime crash, indicating this is the sector closely tied to Wall Street revenue. (This sector tends to have net assets near 10M, multiple homes, portfolios, etc.) The general trend of increasing wealth inequality is pretty clear, see also: https://www.investopedia.com/articles/investing/110215/brief-history-income-inequality-united-states.asp https://www.investopedia.com/articles/investing/110215/brief...
thoughtstheseus 4y ago
Obviously, the average household has two workers today.
d_burfoot 4y ago
I'm shocked at how many people take inflation numbers seriously. To me, it's just obviously government propaganda. Primitive society: priest-scribes working for the state pore over the movement of the stars, after much study pronounce that the gods are pleased, and all will be well after we sacrifice 100 goats. By the way, there is no better way to organize society, because the king is descended from the sun god Modern society: priest-scribes working for the state pore over econometric numbers, after much study pronounce that the economy is strong, and all will be well after we print 4 trillion dollars for economic stimulus and then raise interest rates to tame inflation. By the way, there is no better way to organize society, because the government is democratically elected
- lp0_on_fire 4y ago
  > I'm shocked at how many people take inflation numbers seriously. To me, it's just obviously government propaganda. I agree that the current way of dealing with monetary policy feels closer to rain dancing than actual science but people are taking it seriously because they're seeing it in their grocery and fuel bills every day.
kazinator 4y ago
More instances of two people in the household working versus one could go far in shifting a percentile like this, it seems.

32 points by KoftaBob 4y ago

CM30 4y ago

Wonder how many of these households are in the Silicon Valley area? Feels like wages at large tech companies have skyrocketed in the last few years, and could reach this number quite easily.

MontyCarloHall 4y ago
No. The entire Bay Area is home to about 8M people, of which approximately 10% are tech workers [0]. This is a drop in the bucket across all 23.8M high earning American households. [0] https://www.mercurynews.com/2019/06/14/tech-employment-bay-area-reaches-record-highs-google-apple-facebook-adobe/amp/ https://www.mercurynews.com/2019/06/14/tech-employment-bay-a...

HWR_14 4y ago

Are we just quoting people who make stuff up now? I tried reading his source and that's not what the numbers there say. His '67 numbers are too low, his current numbers too high. Although maybe I misread the original data he links to. If so, please let me know.

brianwawok 4y ago

I wonder how much of this chart can be explained by "California/New York City". What's the same chart look like for a random state in the Midwest?

andrekandre 4y ago
definitely, i suspect you would see very different distributions... simplified charts like those hide a lot of important details also, how significant is income actually? how about total wealth? whats the debt level at each of these gradations etc?

j7ake 4y ago

There is also a larger fraction Of households where both parents work compared to 50 years ago

ethagknight 4y ago

Assuming for now that this graph is accurate from US census data, the graph really flies in the face of the “disappearing middle class.” The authors follow-up tweet about African-American earnings is also interesting, similar results.

brianwawok 4y ago
Right. For sure if you look at the data I think the biggest increases have been the .1% and the .01%. The drop in poverty is really good, and something our negativity biased news organizations are happy to skip. There have been some great human improvements over the past 50 years.

ren_engineer 4y ago

alternative title: Number of dual income families in the US with both parents forced to work to survive increased since 1967, while also working longer hours don't piss on my boot and tell me it's raining, almost every observable metric shows living standards have dropped significantly in the US over the past few decades

abduhl 4y ago
I’d be interested in seeing these metrics and how they quantify living standards. Does living standard mean “keeps pace with the average <standard> at a given time” or does it mean “given a specific objective <standard>“? For example, when I was a kid having cable television went from not standard when I was in elementary school to standard by the time I entered high school. Similarly: internet access, cell phones, having a computer, having a laptop, etc. This was true even outside of tech: having more than one car, having central air AC, having your own bedroom, taking the bus to school or being driven, and even having a bike evolved as I grew up.
wfhordie 4y ago
And it's all downhill from here. With the collapse of globalization, everything will become cheaper, slower, worse quality, and harder to get.
- bergenty 4y ago
  Globalization will not collapse. As long as we have free and open trade nothing is really going to kill it.
  - wfhordie 4y ago
    >As long as we have free and open trade nothing is really going to kill it. I've got some really bad news for you, friend. The free trade era is already over and demographic collapse is coming for almost everyone. https://foreignpolicy.com/2021/07/20/free-trade-dead-managed-carbon-border-tax-climate-tariffs-trade-war-protectionism-esg-biden-trump-eu-china/ https://foreignpolicy.com/2021/07/20/free-trade-dead-managed...

gedy 4y ago

"...because they need two incomes to pay for what one used to cover."

pjdemers 4y ago

Back in the 60's, many full time jobs came with a defined benefit pension. Health care was not nearly as expensive, even without insurance. Last, houses were cheap, college was almost free, and there were many more good public schools, so living in the very best school districts wasn't as important. In other words, many of the things that today's households making > $150k spend money on were vastly cheaper.

rayiner 4y ago
I call this sort of reasoning the "Wonder Years" fallacy. People forget that the “middle class family” in "The Wonder Years" show--headed by a man who graduated college and a woman who completed some college--would have been a solidly top 10% family in 1970. Since 1970, the poverty rate among seniors has dropped from almost 25% to just above 10%: https://sgp.fas.org/crs/misc/R45791.pdf https://sgp.fas.org/crs/misc/R45791.pdf. Although more people had pension plans (though never a majority), they were not portable, and most workers never stayed at a job long enough to earn their pension. Pension benefits were also low compared to what they are now. See: https://retirementlc.com/golden-age-pensions-another-fairy-tale https://retirementlc.com/golden-age-pensions-another-fairy-t... Healthcare was cheaper in 1970, but because doctors could not do much for you if you got heart disease or cancer or other chronic illnesses. In 1970, 40% of heart attack patients who were hospitalized died. Today, it is well under 10%. Living longer doesn’t happen automatically, it costs money. Not just to develop heart medication or cardiac stents, but for the decades of additional care that is required when a heart attack patient survives to old age instead of dying at age 55. It’s not just old people either. The infant mortality rate has dropped from 26 per 1,000 in 1960 to under 6 per 1,000 in 2020. That wasn’t from cheap interventions like vaccination, which happened a generation before that. It was from expensive interventions like giving birth in hospitals, extensive pre-natal care, surgical interventions for sick infants, etc. The costs per square foot of new houses has stayed pretty much the same from 1970 to 2015: https://fee.org/articles/new-homes-today-have-twice-the-square-feet-per-person-as-in-1973 https://fee.org/articles/new-homes-today-have-twice-the-squa.... What people overlook is that (1) as the population grows, the "frontier" of where the typical new house is being sold moves; and (2) people are using their growing income to buy much bigger houses. For example, Silicon Valley was an underpopulated, undesirable suburban and rural area in the 1960s—that’s why they built semiconductor facilities there! It’s important to account for both price increases (paying more for the same thing) and consumption increases (paying more to get more). A good example of both of those things happening is college. The cost of college has undoubtedly gone up faster than inflation. But it’s also a very different product than it was in 1970, with fancy housing and recreational facilities and tons of handholding from support staff. By contrast, housing is a good example of something where it’s been mainly consumption increases. People are taking all their extra income and using it to buy bigger houses in more desirable areas.

missedthecue 4y ago

I'm surprised how many commenters here seem frustrated by this news.

refurb 4y ago
For whatever reason positive news tends not to play well on HN, even if it’s factual. But on another point, I recall that the entry of women into the workforce was almost complete by the 70’s so moving from one to two earner household isn’t likely the main driver.
- wfhordie 4y ago
  >For whatever reason positive news tends not to play well on HN, even if it’s factual. People on HN are very good and detecting when someone is trying to blow sunshine up their ass. Take, for example, the second part of this tweet: >Very poor households (< $25K) shrunk from 24.7% to 18.1% (number rose slightly) That is an abject failure of an economy if I even saw one. 18.1% of households in the most embarrassingly rich country in the history of the planet are living in abject poverty? Even with what you can do with poverty wages nowadays, that fucking sucks. This rate should be <1%.
  - CodeSgt 4y ago
    By no means are 18.1% of the population living in "abject" poverty. They're living in what the US government classifies as poverty, but in the majority of these cases they still have a home, have food, have electricity, etc. I'm not saying that they're living comfy lives, but when you throw around terms like "abject povery" you're really discrediting people who are actually living in abject poverty. What are your plans to get the rate below 1%? What would you have done differently that wouldn't have wrecked the economy?
    - wfhordie 4y ago
      Ah, I love this game. It's the same one that the super-rich use to convince people barely scraping by -- or anyone who hasn't read Barbara Ehrenreich -- that you should zoom out far enough so that your situation is compared to literal kids with literal flies on their eyeballs. Your life ain't that bad, why you complainin'? The fact is, this country could fund universal childcare, universal healthcare and universal education from K-16 and not 'wreck the economy.' All it would take is doing what every other industrialized first-world country has done... and done better, with less resources. And don't worry, the people who you think are actually living in abject poverty aren't reading on HN on a Monday afternoon, so my discredit of their situation will go largely ignored.

Mikeb85 4y ago

This stat is apparently adjusted for inflation but is it adjusted for housing costs specifically?

phendrenad2 4y ago
Good point. It's really hard to adjust for inflation. On one extreme you can use the official inflation numbers, which are lies and damned lies to make the economic progress since the 1960s look better than it is. On the other extreme you can use housing prices. The truth (inflation as felt by the average household) is probably somewhere in-between.

notch656a 4y ago

I think these studies failed to take into account the labor value of the individual (typically wife) who would have been home. And even better, that labor isn't taxed.

kwatsonafter 4y ago
This is an actual and not news-of-the-day topical Liberal, "gotcha." America's wealth is in Her moms! Great comment. God bless Peggy Seeger & Family!

photochemsyn 4y ago

Here's a more useful source of data, including both raw and CPUI-inflation-adjusted numbers: > "On this page is the United States average household income by year and median household income by year between 1968 and 2021. You'll also find the top 1% household income by year between 1996 and 2021, plus the top 5% and 10% for the full range. It's the newest data to this point in 2022." https://dqydj.com/household-income-by-year/ https://dqydj.com/household-income-by-year/ Some takeaways (inflation-adjusted) (1) the median (half above/ half below) is mostly flat over the whole period, with a slight increase about 55K - 65K; anyone near or below this is almost surely a renter with little if any savings working paycheck-to-paycheck if that, and no retirement other than Social Security and maybe a small pension. (2) the top 5% has gone from 150K to 275K, this is probably mostly the white-collar professional sector who own their own homes (the top 10% mirrors this only from 125K to 200K). This probably encompasses well-sized 401K retirement accounts. (3) the top 1% bounces around 500K, although that data is only tracked since the mid 1990s, and seems to track things like 2001 dot com bust, 2008 subprime crash, indicating this is the sector closely tied to Wall Street revenue. (This sector tends to have net assets near 10M, multiple homes, portfolios, etc.) The general trend of increasing wealth inequality is pretty clear, see also: https://www.investopedia.com/articles/investing/110215/brief-history-income-inequality-united-states.asp https://www.investopedia.com/articles/investing/110215/brief...

thoughtstheseus 4y ago

Obviously, the average household has two workers today.

d_burfoot 4y ago

I'm shocked at how many people take inflation numbers seriously. To me, it's just obviously government propaganda. Primitive society: priest-scribes working for the state pore over the movement of the stars, after much study pronounce that the gods are pleased, and all will be well after we sacrifice 100 goats. By the way, there is no better way to organize society, because the king is descended from the sun god Modern society: priest-scribes working for the state pore over econometric numbers, after much study pronounce that the economy is strong, and all will be well after we print 4 trillion dollars for economic stimulus and then raise interest rates to tame inflation. By the way, there is no better way to organize society, because the government is democratically elected

lp0_on_fire 4y ago
> I'm shocked at how many people take inflation numbers seriously. To me, it's just obviously government propaganda. I agree that the current way of dealing with monetary policy feels closer to rain dancing than actual science but people are taking it seriously because they're seeing it in their grocery and fuel bills every day.

kazinator 4y ago

More instances of two people in the household working versus one could go far in shifting a percentile like this, it seems.