Incomes, poverty both on rise
By: DAVE DOWNEY - Staff Writer | ∞
San Diego and Riverside county families are taking home, on average, only slightly more money than they made at the turn of the century, and poverty rates for both regions have increased, a new federal report shows.
The typical Riverside County household earned $53,508 last year, a 3 percent increase over the inflation-adjusted $51,895 average recorded for 1999, according to the 2006 American Community Survey and 2000 Census. Income data from the survey was released Tuesday.
In San Diego County, the median household income edged up 4.6 percent from $56,953 in 1999 to $59,591.
At the same time -- even as unemployment remained low -- the poverty rate swelled from 8.9 percent in 1999 to 11.7 percent last year in San Diego County and from 10.7 percent to 12.2 percent in Riverside County. Federal guidelines defined someone as living in poverty in 2006 if they were in a family of four that earned about $20,600 or less.
Christopher Thornberg, a Los Angeles economist, said the numbers are a clear reflection of California's recent demographic trends, which have been marked by more people moving out of California than are moving in from other states, and by an influx of predominantly low-skilled immigrants.
Thornberg said the trend is driving the widening gap between the highest and lowest wages in California.
"And the middle part of the scale is leaving the state," he said.
As for why the poverty rate rose at a time when unemployment was low, Thornberg said that is because many immigrants have been willing to settle for pay that is on the low end of the scale for California, but above what they would receive back home in another country.
"One man's poverty is another man's middle-class living," he said. "Perspective is everything."
Thornberg added that future reports could show declining average wages. The thousands of low-skilled, but highly paid construction jobs that flourished during the housing boom helped the regional economy stay a step ahead of inflation. But those jobs are now disappearing.
The American Community Survey, an annual snapshot of American families conducted by the Census Bureau, reported income and poverty rates for counties and cities with at least 65,000 residents Tuesday. A companion survey examined national health insurance rates.
Based on a comparison between the reports and inflation-adjusted incomes reported in the 2000 Census, Vista residents on average are making less than they did seven years ago -- $50,162 last year compared to $51,540 in 1999.
Income growth was flat in Temecula and Escondido, when adjusted for inflation, while pay increased slightly in Murrieta, Oceanside and Carlsbad.
San Marcos residents, meanwhile, enjoyed the most generous household-income increase at 17.4 percent to $65,234, the statistics show.
In an apparent contradiction, however, the poverty rate increased from 12 percent to 13.1 percent in San Marcos, the reports state. However, Thornberg suggested that is not a contradiction because the uptick is explained by more people working jobs at relatively low wages.
The poverty rate also increased in Murrieta. The fast-growing city recently annexed -- well after the 2000 Census was taken -- the older, lower-income Murrieta Hot Springs neighborhood that is home to a large number of mobile homes and apartments.
The poverty rate remained unchanged in Carlsbad and Escondido. It increased in Vista and decreased in Oceanside.
Nationally, the poverty rate was 12.3 percent for 2006, up from 11.3 percent in 2000 but down slightly from 12.6 percent in 2005, said David Johnson, chief of the Census Bureau's Housing and Household Economic Statistics Division in Maryland.
The nation's median household income reached $48,200 last year, an increase of 0.7 percent over the year before when inflation is factored into the equation, Johnson said.
"For the second consecutive year, households in the United States experienced an increase in real annual median income," he told reporters in an online news conference Tuesday. "Even though overall household income has not yet recovered to its 1999 pe-recessionary peak of $49,200, the gap is narrowing."
According to a pair of reports released Tuesday, 47 million Americans and 6.6 million Californians did not have health insurance last year. The national rate of 15.8 percent is the highest in many years.
Meanwhile, Johnson said the poverty rate for senior citizens, those ages 65 and older, fell to 9.4 percent. That's the lowest since the government began keeping records in the 1960s, when about one-third of seniors lived in poverty.
While household incomes increased slightly last year across the nation, wages declined 1 percent.
Johnson said the apparent discrepancy is the result of more family members holding down full-time jobs and boosting household-income totals.
-- Contact staff writer Dave Downey at ddowney@californian.com.
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Consider The Obvious wrote on Aug 28, 2007 10:23 PM:You don't suppose those figures have anything to do with the Mexican government's decision to move a couple of million of its most impoverished citizens here, do you?
American Mike wrote on Aug 28, 2007 10:56 PM:Nice report. Have recently thought about doing taxes early so as not to be caught off guard EOY. 28% here, it's tough to manage.
Miss Teen South Carolina wrote on Aug 29, 2007 12:04 AM:So between 1999 and 2006, incomes rose 3% in Riverside Conuty and 4.6% in San Diego. How is this possible when the price of homes in these two counties shot through the roof in the same time span? Shouldn't people's expenditures reflect their incomes and adjust accordinlgy with changes to those incomes? Oh, yeah, many people weren't living wihtin their means. Those now crying for help because they can't pay the mortgage on their 100% financed home should look at this article and realize that there are people living amongst them that have true financial problems, the causes of which can be debated here endlessly. However, living outside thier means likely isn't one of them. This is not to say that filing for bankruptcy or defaulting on a $500,000 loan aren't serious financial concerns; however, I doubt the individuals dealing with those issues rarely worry about how to support their family of four on an annual household income of $20,600.
Wait a minute.... wrote on Aug 29, 2007 6:49 AM:under your Nation/World according to Washington poverty is on the decline....which is it NCT?
Mo V. wrote on Aug 29, 2007 6:51 AM:It's working. For years we have been exporting every job we could to countries that pay pennies an hour. Those jobs that cannot be exported are being done by imported slave labor. Meanwhile, the futre prosperity of America has already been spent blowing up and rebuilding other countries. This didn't just happen, it was planned.
Vista Granny wrote on Aug 29, 2007 6:55 AM:Yes, American Mike, this is definitely the place to brag about your income.
and it will continue wrote on Aug 29, 2007 6:55 AM:with all the middle class jobs going outside the boarders and the labor costs for lower educated labor go down to meet what they are in TJ. What is the going rate for labor in TJ? Get used to it, the seperation of haves and have nots will begin to mirror Mexico.
Why the surprise? wrote on Aug 29, 2007 6:57 AM:The SW county, never had potential for money making technological businesses like San Diego County. The only thing it had to offer was cheap housing. Of course income is flat and poverty is on the rise. The region is only now reaching financial equilbrium, and don't look for it to get any better.
Miss Responsible wrote on Aug 29, 2007 7:21 AM:Poverty on the rise is no surprise when students choose to drop out, get pregnant, join gangs, use drugs...and you also report today "three in four arrests test positive for drugs." Where is responsibility. As long as Uncle Sam keeps bailing them out, they will keep dropping out!
Hmm. wrote on Aug 29, 2007 7:29 AM:Funny how Temecula's poverty rate was left out wasn't it? Probably because it's still higher than the surrounding areas. Why the surprise? said it perfectly. SW county can only attract manufacturing companies, nothing high tech. Murrieta may soon with the other two hospitals being built.
Misleading Stat wrote on Aug 29, 2007 8:46 AM:Its easy to see from the comments of those reading this article that they don't understand that using "household income" is not a measure of "income". At best, it is misleading, at worst its a dishonest way of making the economy look worse than it actually is. For example, if my 22 year old daughter moved out of my "household", 2 things happened. 1) my "household" now has less income, and; 2) there are now more "households". Even though the total income did not change, average "household income" went down. The only statistic that matters is individual income. "Household income" has little or no meaning.
anon wrote on Aug 29, 2007 9:10 AM:My income is 23,000, would love it to be 50,000 then I could have health care. I make too much to get help from the government .having a place to live and food and my entertainment, bloging .cheap fun. Those that got loans and now cant pay for them, helping them out is not fair to those in my shoes that can’t even get health care!the banks need no help they knew!
Dr. Bubble wrote on Aug 29, 2007 9:25 AM:I was waiting for these #'s to come out... From 1999 to 2006 America, specifically CA, and ESPECIALLY SD experienced the biggest gains in real estate value--EVER!! Now that the proverbial "bubble" has either popped or steadily let out a lot of air, you hear a lot of armchair-economists out there saying, "We've seen the worst of it," or "the market will come back in 3-5 years, just hold on..." This is all a load of manure. --Why?-- Because the average incomes need to catch up to the new average home prices before we see any gains in the real estate market again. In late '06 to early '07 the interest rates on 30yr fixed loans under $417,000 were in the high 5%'s and the market was STILL DEAD! This is concerning because the money to borrow was real cheap, yet people couldn't afford to stretch any further. Look at the #'s above; Carlsbad's avg income went up around 7% in seven years while it's real estate went up over 200% in the same amount of time. This example is consistent with 95% of the cities in SD, so what does that tell you??? Dr. Bubble's forecast is gloomy skies and and depreciating home values for the next 3+ years, and then a "leveling off period" of zero appreciation for 10-15 years before we see any gains anymore. Real estate in SD will no longer be viewed as a good "short term investment." --You disagree?-- How can you when the average person's income must DOUBLE to even think about affording a home in most SD cities (the avg person's income would actually have to TRIPLE to be on par with 1999)? So the question is, "How long will it take for the avg person's income to double??? About 10-15 years.
cause and effect wrote on Aug 29, 2007 9:34 AM:How can we expect income to rise when our education declines? Enough with the teachers' union, let's step up our game.
Concerned-1 wrote on Aug 29, 2007 9:52 AM:This recession--yes I think we are in one--could shake out some positive changes that need to be made in our economy. I think a decline of the illegal workforce will have a positive effect on several industries. Construction and manufacturing can be positive paths to a middle class income. Our younger generation needs both education and blue collar jobs, both of which are heavily impacted by illegal immigration. We need to put Americans to work!
Sacramento Politician wrote on Aug 29, 2007 9:54 AM:I guess we are going to have to raise those taxes, so that we can get the revenues into Sacramento, so all those social programs and pet projects can be kept running. And of course, the funding requirements of those programs do increase.
o2cool1 wrote on Aug 29, 2007 11:01 AM:There's only one thing for our government to do, lower the poverty threshold,thereby eliminating poverty.So to those of you making $20,600 a year I say welcome to the lower middle class,you are no longer poor.
Patrick wrote on Aug 29, 2007 11:51 AM:Wow, the richest nation on earth has 12% poverty rate, that's disgusting!
American Mike wrote on Aug 29, 2007 12:21 PM:Vista Granny wrote on Aug 29, 2007 6:55 AM: " Yes, American Mike, this is definitely the place to brag about your income. " No brag. Single, no business tax loopholes, no dependents, no church to donate to. Being in a 28% tax bracket does not mean a high income, just means you don't meet the criteria for tax relief. It means your not on welfare, food isn't paid for with stamps, nor does it come in conspicuously unmarked white boxes, your children can't qualify for Federal grants, tuition and books are not free, you pay full price for utilities, you pay for medical insurance, then pay again when you visit a doctor, and carry full coverage auto and home insurance. The list goes on and on. The only thing I do enjoy about it is when the checkbook reaches zero (fingers crossed it isn't red) end of each month, no one else has paid my living expenses. Poverty is a two way street. Low income trying to make its way up, and middle class income being taxed into the low-income bracket. It's difficult in either direction with the social responsibilities imposed upon American workers. But you keep thinking Granny, nice try. I've still several years of paying social security tax, I'm there for you, always have been.
Ask a Democrat wrote on Aug 29, 2007 1:11 PM:If your making $80K a year, and $110K in Newy York, your still poor enough to qualify for Children's Health Insurance. Personally, I'm waiting for the income level to him me. Needs to go a little higher.
Illegal aliens create poverty wrote on Aug 29, 2007 2:36 PM:Most of the people below the poverty line in California are illegal aliens. When they go back to their home countries or are deported then the poverty will go away with them.
Paul wrote on Aug 29, 2007 3:52 PM:How is it if the median income here is almost 60K, and the median house range is 570K and you are all cruising around in your brand new gas guzzling SUV's? Credit cards maxed? It just doesn't add up. I make twice the median and I rent because a house payment would bury me and my car is ten years old. So please tell me all you seemingly wealthy people all around me, just how are you all doing this??
to "illegal aliens" wrote on Aug 29, 2007 6:52 PM:Excuse me, but they DO NOT keep track of poverty numbers on illegal immigrants as they are undocumented and thus have no records period. Do you honestly believe illegal aliens are part of any census or polling and if so exactly how are they participating in such antics and who is asking them questions? Are they surveying them in their shanty towns and canyons? New to me....
wow wrote on Aug 29, 2007 6:55 PM:this is the saddest and most uninformed group of commentary I have seen in a bit. The lack of general understanding of basic math, trends and statistics. I honestly don't know what you people are teaching your children???
tom2 wrote on Aug 29, 2007 8:59 PM:The day of reckoning has finally come. Everyone was warned about excessive spending and running up debt. Our government is the worst offender of all. The housing pyramid scheme is over. Americans will have to begin producing tangible goods for export. The perception that we all will get rich trading each other houses and paper assets, like stocks must end. 30 years ago, hard working blue-collar work was admired, which produced real wealth for America. Unfortunately, the common view that hard work is for chumps only leads to demoralization of the work force and loss of wealth creation for our country. Everyone wants to sit at a laptop and click their day away while thinking they are the most valuable workers. We need to return to traditional values. Hard work, honesty, love of country. Which means we must stop the crooks in office and corporate CEOs from selling out our country for quick profits.
Diane wrote on Aug 29, 2007 9:05 PM:Income (don't care if it's individual, household or boat load!) needs to equalize with costs of living...especially in California. I moved from Minnesota where I was making $18.50 an hour as a Cust. Serv. Rep. (after 6 years), owned a 2200 sq. ft HOUSE with a hot tub and pool in back yard = $1200 a month payment. Out here, 1700 sw. ft 2005 manf. home wiht land for $300K and husband and I making $35-30K LESS than MN. This states is pathetic and yes, the rich get richer....If I knew THEN what I know now, we would have turned down the job transfer and figured out how to make a $1200 payment in MN rather than work for our house payment only here! I'm bailing as soon as I can sell!
Diane wrote on Aug 29, 2007 9:07 PM:And as a side note...thank god the only debt we have is the house...and a minor balance on a credit card. THAT is how we're able to afford a mtg. (30 yr. fixed) - I don't believe in living beyond what my income can afford and maxing out credit cards, home eq. loans, blah blah blah.
MJ wrote on Aug 29, 2007 9:46 PM:One has to wonder if the only way this cycle of insanity will be broken is if there is a deep recession or mini depression. I think actually the beginning of the end was about 30 years ago when credit cards become "the norm". Nowadays middle class folk live like they are upper middle class -- and they are living on borrowed time.
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