In December, the U.S. Census Bureau released the latest five-year estimates from the American Community Survey (ACS), a large-scale survey that provides a snapshot of social, economic, and housing characteristics of households across the country. The new data offers a glimpse into the economic conditions for many Americans over the five years ending in 2021.
Income Growth vs. Rising Inflation
The new data shows that the typical American household earned an average of $69,021 annually over this five-year period. This figure represents a 6% increase compared to the previous five-year period ending in 2020. However, the increase in income has been largely negated by the surging inflation in recent years.
Inflation hit a multi-decade high of 9.1% in June 2022, although it has since decreased. Despite this, inflation is still historically high, and many Americans, especially those with lower incomes, are struggling to cope with rising living costs.
Missouri’s Economic Struggles
In Missouri, the typical household earns $61,043 annually, which is below the national average. However, within the state, there are significant differences in income levels. For instance, Versailles, a town in Missouri, has the lowest average income of all the towns with available data. The typical household in Versailles earns only $22,786 a year, which is a staggering 62.7% less than the statewide median household income of $61,043.
High Poverty Rates in Versailles
The low incomes in Versailles contribute to a higher-than-average poverty rate. The town’s poverty rate stands at 29.0%, which is significantly higher than the statewide poverty rate of 12.8%. This disparity highlights the financial struggles of many residents in Versailles, where income levels are not enough to absorb the rising costs of living.
The Impact of Rising Costs on Lower-Income Americans
With inflation still at historic highs, many low-income households are finding it harder to keep up with the cost of everyday goods and services. The increase in income, while beneficial for some, has been largely wiped out for many Americans due to the surging prices of essential items. Those at the lower end of the income spectrum are feeling the greatest impact, as they have fewer resources to cope with the rising costs.
The 2021 American Community Survey data from the U.S. Census Bureau highlights both the increase in income for many Americans and the challenges posed by inflation. While incomes have risen slightly, the high cost of living has made it difficult for many households to see the benefits. Versailles, with its low average income and high poverty rate, serves as a reminder of the significant income disparities that exist in the U.S. and the ongoing struggles faced by those living in poverty.
