Economy Watch: Household Income Posts Record Growth in 2015

Last year marked the first annual increase in median income in almost a decade, which is especially good news for the retail and hospitality sectors.
Source: U.S. Census Bureau

Source: U.S. Census Bureau

The Census Bureau reported some remarkably good news on Tuesday about the U.S. economy, which also happens to be good news for certain classes of real estate, particularly retail, hospitality and healthcare space. According to the bureau, three important economic metrics have done very well lately. Namely:

  • Median household income in the United States in 2015 was $56,516, an increase in real terms of 5.2 percent from the 2014 median income of $53,718. That’s the first annual increase in median household income since 2007, the year before the most recent recession. This is especially good for retailers, who depend on people spending their incomes, and also important for the hospitality industry, since travel mostly counts as a luxury good.
  • The nation’s official poverty rate in 2015 came in at 13.5 percent, with 43.1 million people in poverty, or 3.5 million fewer than in 2014. The 1.2 percentage point decrease in the poverty rate from 2014 to 2015 represents the largest annual percentage point drop in poverty since 1999, when the economy was quite strong.
  • The percentage of people without health insurance coverage for the entire 2015 calendar year was 9.1 percent, down from 10.4 percent in 2014. The number of people without health insurance declined to 29 million from 33 million over that period. The more Americans with health insurance, the more who will use the services of healthcare providers and, in the longer run, that means more demand for healthcare space.

These findings are contained in two reports: Income and Poverty in the United States: 2015; and Health Insurance Coverage in the United States: 2015. The Current Population Survey Annual Social and Economic Supplement was conducted nationwide and collected information about income and health insurance coverage during 2015.