

Household incomes vary widely across the U.S., creating a new kind of inequality
source link: https://finance.yahoo.com/news/household-incomes-us-new-inequality-173128922.html
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workers are struggling to keep
Household incomes vary widely across the U.S., creating a new kind of inequality
Post-pandemic America has seen inflation grow rapidly, along with household income inequality.
According to a recent study published by the Economic Policy Institute (EPI), household incomes have decreased for the average American since 2019 and vary widely by state. (Income is defined as earnings plus Social Security, dividends, interest, etc.)
For example, southern states like Louisiana, Alabama, Mississippi, and Arkansas saw a median income of $55,000 or less in 2021, whereas Maryland topped $90,000 and New Jersey and Massachusetts not too far behind at over $89,000.
According to the EPI data, household earnings grew by 4% since 2019, with the national median earnings for workers 16 and older at $40,260 in 2021. Earnings refer to wages or salaries paid to an employee.
While the EPI data does not account for the four-decade high in inflation seen in 2022, the factors affecting household income in each state remain the same.
"At the state level, you can see how different policies produce different outcomes in workers' earnings and household income," Chandra Childers, senior policy and economic analyst at EPI and author of the study, told Yahoo Finance.
She noted three specific policy factors: unionization rates, minimum wage, and unemployment resources.
"For example, many of the states with the lowest wages are also anti-union states, and we know that unionization raises workers’ wages and improves working conditions," Childers said. "More directly, states that raise their minimum wages above the federal minimum and that eliminate tipped wages allow you to compare how well workers and families might be doing in those states compared with states that don’t. States also differ in how easy or difficult it is to access supports such as unemployment insurance during an economic downturn."
These disparities have left many workers struggling with income that hasn't kept up with the rising cost of living.
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