Confusing Numbers

If you are digging into the updated Survey of Consumer Finances data, released earlier today, watch out for a confusing presentation of changes in medians. The percent change columns in the tables are median percent changes, not the percent change in median values. Likewise, the dollar change columns are median dollar changes, not the dollar amount by which the median changed.

Between 2007 and 2009, for example, median household net worth fell from $125,400 to $96,000 (in 2009 dollars), a 23 percent decline in the median value. But the table provided by the Federal Reserve shows "median % change" to be -18 rather than -23. That's because the Feds are measuring the median percent change in net worth rather than the percent change in median net worth. In other words, half of households saw their net worth decline by more than 18 percent between 2007 and 2009 and half saw their net worth decline by less than 18 percent. Likewise, the dollar change in median net worth between 2007 and 2009 was $29,400. Yet the Feds show "median $ change" to be $11,400. This means that half of households saw their net worth decline by more than $11,400 between 2007 and 2009 and half saw their net worth decline by less than that amount.

Insanely confusing.