US median household income falls for third straight year
Median family income dropped by 2.3% from 2021 to 2022, marking the largest national decrease since 2010.
LEARN MOREPosted: 9:27 a.m. EDT Oct 6, 2023
Hiring levels in the U.S. exceeded expectations as employers added 336,000 workers in September, according to data released Friday by the Bureau of Labor Statistics.
The data indicated that the unemployment rate remained unchanged at 3.8%, marking 21 straight months the rate has been below 4%.
The continued uptick in hiring comes even as federal interest rates are at a 23-year high. High interest rates are meant to cool inflation but generally also cause employment to take a downturn.
Unemployment and job growth are factors the Federal Reserve considers when deciding to raise interest rates.
One reason inflation has remained persistent is due to workers making more money. The Bureau of Labor Statistics said that average hourly earnings have increased 4.2% in the 12-month period ending in September. As of August, the consumer price index showed price increases of 3.7%.
The Federal Reserve has said its goal is to get inflation down to a normalized rate of 2%. Federal Reserve Chair Jerome Powell said one key to that happening is to get wage growth to subside.
In the last year, the U.S. workforce has grown by 3.3 million, while at the same time the number of those not in the workforce dropped by about 250,000.
Several occupations have seen significant growth in the last year, including management, business and financial operations occupations, which added over 1.3 million workers. Service occupations have also added nearly a million workers since September 2022.
“The food and hospitality industry has been able to fill these jobs. Those sectors have been desperate for workers since COVID began,” said Kent Gardner, retired chief economist at the Center for Governmental Research.
Gardner said it has been difficult for people seeking entry-level jobs to find gainful employment, and they may be turning to food and hospitality jobs as an alternative.
White House economic adviser Jared Bernstein said strong consumer spending led the way to strong job figures.
"So, one of the things to keep in mind is that when you have a labor market that's generating this level of job gains, you almost by definition have a solid healthy American consumer, and 70% of our economy is consumer spending," he said. "So I think a job number like this actually helps to keep the momentum that we've seen in our economy going. It promotes strong, steady growth and it provides a lot of great opportunities for people coming into the job market."
