Congress Needs to Focus on Job Creation

New Census data highlight why Congress needs to focus on policies to alleviate unemployment.

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New data released September 12 by the U.S. Census Bureau on family and household incomes mirrors recent employment trends, underscoring the need for job-creating policies from Congress.

In 2011 the typical U.S. household had an income of $50,054, just below what it was in 2010 in inflation-adjusted dollars. This means that the Great Recession of 2007–2009 and the lingering high unemployment since then erased all the gains of the past 15 years. Household income has fallen 8.1 percent in inflation-adjusted dollars since 2007, the year before the Great Recession began. This is compared to a 2 percent decline over the early 2000s recession.

The trends are even starker for nonwhite families. African American households have incomes today that are lower than they have been since 1994—and for Hispanic households, since 1997.

The new data from the Census Bureau reveal why the current employment situation is untenable. U.S. unemployment continues to hover around 8 percent, leaving 12.5 million people out of work and searching for a job. Overall, the share of the U.S. population with a job remains at a low not seen since 1983. Given that most U.S. families derive the majority of their income from earnings, these employment trends are clearly crimping any chances for earnings to rise in 2012.

Indeed, as income for the typical family falls, the incomes of those at the very top are rising. New Census data show that income inequality across households increased between 2007 and 2011. Part of the reason for the widening gap can be attributed to the rebound of the stock market from early 2009 to 2011, with the Dow Jones Industrial Average alone gaining 35 percent over those three years. This has increased the incomes of the well-off but has left Main Street behind.

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