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Average American Income

Average American Income

The U.S. Census Bureau compiles data regarding household income and per capita income in the United States of America. In this article, we will learn about the median household income in the US.
Arjun Kulkarni
The U.S. Census Bureau employs several yardsticks to compile data about the population, unemployment, income, demographics, etc. To compile data regarding the average income, the terms 'household income' and 'per capita income' are commonly used.
Although many people think of 'average income' as an indicator of the economic health of the citizens of the US, economists rely on the concept of 'median income' for their research. One of the prime reasons for this is the fact that average income can vary to a large extent, on account of the huge gap between the highest earners and the lowest earners in a country. Median income, on the other hand, provides a more realistic and accurate estimate of the earnings of a population. For example, around 0.1% of the total population of US has an annual income exceeding $1.5 million a year. This negligible section of the total population skews the average income, providing an unfair idea of how average Americans are faring economically. To counter the unreliability of this economic indicator, the concept of median household income is employed.
Household income is the sum of all the income earned by the members of a household aged 15 and above. Income includes,
  • Wages and Salaries
  • Unemployment Insurance
  • Disability Payments
  • Child Support Payments Received
  • Regular Rental Receipts
  • Personal Business
  • Investment Returns

Per capita income is defined as the income earned by all the people in a particular area divided by the total population in that area. For example, in a geographical area of 20 people, if 10 people earn $1000 each and the remaining 10 people earn $2000 each, the per capita income will be $1500.
The U.S. Census Bureau calculates the median household income and median per capita income after getting the required data about the population and their total income. In 2011, the median household income dropped by 1.7% from $51,144 to $50,502. The median per capita income for the year 2011 stood at $41,560. The data for the year 2012 will be published by the U.S. Census Bureau this year.
Median Income in America

State Median Per Capita Income Median Household Income
Alabama 34,880 41,415
Alaska 45,665 67,825
Arizona 35,062 46,709
Arkansas 33,740 38,758
California 43,647 57,287
Colorado 44,053 55,387
Connecticut 57,902 65,753
Delaware 41,449 58,814
Dist. of Col. 73,783 63,124
Florida 39,636 44,299
Georgia 35,979 46,007
Hawaii 42,925 61,821
Idaho 32,881 43,341
Illinois 43,721 53,234
Indiana 35,689 46,438
Iowa 41,156 49,427
Kansas 40,883 48,964
Kentucky 33,989 41,141
Louisiana 38,549 41,734
Maine 38,299 46,033
Maryland 50,656 70,004
Massachusetts 53,471 62,859
Michigan 36,264 45,981
Minnesota 44,560 56,954
Mississippi 32,000 36,919
Missouri 37,969 45,247
Montana 36,016 44,222
Nebraska 42,450 50,296
Nevada 36,964 48,927
New Hampshire 45,881 62,647
New Jersey 52,430 67,458
New Mexico 34,133 41,963
New York 51,126 55,246
North Carolina 36,028 43,916
North Dakota 47,236 51,704
Ohio 37,836 45,749
Oklahoma 37,679 43,225
Oregon 37,527 46,816
Pennsylvania 42,291 50,228
Rhode Island 43,875 53,636
South Carolina 33,388 42,367
South Dakota 44,217 48,321
Tennessee 36,567 41,693
Texas 40,147 49,392
Utah 33,509 55,869
Vermont 41,572 52,776
Virginia 46,107 61,882
Washington 43,878 56,835
West Virginia 33,403 38,482
Wisconsin 39,575 50,395
Wyoming 47,898 56,322
USA 41,560 50,502

(All figures are in USD, and are for the year 2011. Figures have been adjusted for inflation.)
The income distribution in the United States has been a highly debated topic, especially after the recession of 2007-08. In 2012, people, infuriated with government policy of bailing out multi-billion dollar corporations with public money, camped outside the Wall Street to lodge their protest. Various reports over the years have stated that America's wealth distribution is flawed, and a handful of politicians and entrepreneurs hold the reins of the entire American economy. Although the government has promised to lessen the gap between the rich and the poor, the ground reality is that the rich are getting richer, and the poor are struggling to find a foothold in post-recession America.