This is a tale of two age groups, the one overcome by a wave of economic change and the other triumphantly riding the wave —or so it might seem.
Those tumbling in the wave are 35-to-44-year-olds, the age group now filled with the youngest boomers (this year boomers span the ages from 42 to 60) and the oldest generation Xers (aged 30 to 41). Those riding the wave are 55-to-64-year-olds, the age group filling with the oldest boomers.
The socioeconomic trends among 35-to-44-year-olds are grim:
1. Men's incomes are shrinking: The median income of men aged 35 to 44 was not only lower in 2004 than in 2000, it was also 3 percent below the level of 1990, after adjusting for inflation. In contrast, the median income of the average man rose 7 percent between 1990 and 2004, according to the Census Bureau's Current Population Survey.
2. Household net worth is declining: The net worth of households headed by 35-to-44-year-olds fell 16 percent between 2001 and 2004, after adjusting for inflation—the only age group to lose ground during those years, according to the Federal Reserve Board's Survey of Consumer Finances.
In contrast, take a look at the trends among 55-to-64-year-olds:
1. Men's incomes are growing: The median income of men aged 55 to 64 grew nearly twice as fast as the average between 1990 and 2004 (up 13 percent) and even grew 5 percent between 2000 and 2004.
2. Household net worth is rising: The net worth of households headed by 55-to-64-year-olds increased by an impressive 29 percent between 2001 and 2004, after adjusting for inflation—the greatest gain among age groups and far above the paltry 1.5 percent gain for the average household during those years.
But 55-to-64-year-olds may be riding a wave into a rocky shore. Behind their growing incomes and net worth is greater labor force participation as pension benefits shrink and retirement recedes. The labor force participation rate of men in the age group rose 2 percentage points (from 67 to 69 percent) between 2000 and 2005. Among women aged 55 to 64, the labor force participation rate rose even more (from 52 to 57 percent) as career-oriented boomers filled the age group.
Working more because retirement benefits are shrinking (a de facto pay cut) is not good news for the millions without substantial retirement savings, although it will delay by a few years the rocky landing that lies ahead.
Monday, March 27, 2006
Wednesday, March 22, 2006
Cool Research Link: Working Papers from the 12 Federal Reserve Banks
Think you're working harder than ever? Not so, says new research from the Federal Reserve Bank of Boston. A study by Mark Agular, a senior economist at the Boston bank and Erik Hurst of the University of Chicago examines time use over five decades and finds both men and women working less and playing more. Their study, "Measuring Trends in Leisure: The Allocation of Time over Five Decades," documents the decline in hours spent working by nonretired men and women aged 21 to 65 between 1965 and 2003. Although women in 2003 work more than those in 1965, the authors find the increase in women's work hours have been more than offset by the decline in the time women spend doing housework. During those years, men's work hours declined, although the drop has been somewhat offset by an increase in the amount of time men spend doing household chores such as shopping, food preparation, and cleaning. Overall, the amount of time men and women spend in market (paid) work has dropped from 34.24 to 33.01 hours per week, a decline of 1.23 hours. The amount of time men and women spend doing household chores has dropped from 23.52 to 18.00 hours, a decline of 5.52 hours since 1965. Total hours of work per week, then, have fallen (and leisure increased) by an average of 7.60 hours among men and 6.44 hours among women.
This is just one of many fascinating studies generated by the nation's 12 Federal Reserve Banks (in Boston, New York, Philadelphia, Cleveland,
Richmond, Atlanta, Chicago, St. Louis, Minneapolis, Kansas City, Dallas, and San Francisco). If you burrow into each bank's Research link, you can find studies on the economic impact of early childhood education (Minneapolis), on whether black workers pay a price for having ethnic names (St. Louis), and a theory of political cycles (Richmond). Most important to many researchers is the analysis of regional economic trends generated by each bank. Those who want an in-depth exploration of how businesses and consumers are faring in a specific region should take a look at that area's Federal Reserve Bank research.
This is just one of many fascinating studies generated by the nation's 12 Federal Reserve Banks (in Boston, New York, Philadelphia, Cleveland,
Richmond, Atlanta, Chicago, St. Louis, Minneapolis, Kansas City, Dallas, and San Francisco). If you burrow into each bank's Research link, you can find studies on the economic impact of early childhood education (Minneapolis), on whether black workers pay a price for having ethnic names (St. Louis), and a theory of political cycles (Richmond). Most important to many researchers is the analysis of regional economic trends generated by each bank. Those who want an in-depth exploration of how businesses and consumers are faring in a specific region should take a look at that area's Federal Reserve Bank research.
Tuesday, March 14, 2006
Bet You Didn't Know
Fifty-three percent of Americans live in one of the nation's 673 coastal counties, according to the Census Bureau, down from 54 percent in 1970.
Sunday, March 12, 2006
More about Women in the Labor Force
Let's talk about the labor force participation rate of women again. This time, let's look at labor force rates by Hispanic origin. Hispanic women are much less likely to work than the average American woman, and the growing presence of Hispanics among young adults in the population is reducing the labor force participation rates of young women.
In 2005, the labor force participation rate of Hispanic women aged 20 to 24 was just 59.4 percent—much lower than the 70.1 percent labor force participation rate of all women in the age group. Subtracting Hispanics from the total lifts the labor force participation rate of women aged 20 to 24 to 72.2 percent.
Men are not immune from these forces, although Hispanics have the opposite effect on men's rates because Hispanic men are more likely to work than non-Hispanic men. The labor force participation rate of men aged 20 to 24 was 79.1 percent in 2005. Without Hispanic men in the mix, the age group's labor force participation would have been an even lower 77.9 percent.
Between 2000 and 2005, the labor force participation rate of women aged 20 to 24 fell 3.0 percentage points (from 73.1 to 70.1 percent). The labor force participation rate of men aged 20 to 24 fell 3.5 percentage points (from 82.6 to 79.1 percent). The rates for Hispanic men and women fell by an even larger amount—down more than 5 percentage points during those years. What explains a decline in labor force participation that is greater among men than women and greater among Hispanics (who are more likely to work in low-paying entry-level jobs) than non-Hispanics? The explanation is a weak economy.
In 2005, the labor force participation rate of Hispanic women aged 20 to 24 was just 59.4 percent—much lower than the 70.1 percent labor force participation rate of all women in the age group. Subtracting Hispanics from the total lifts the labor force participation rate of women aged 20 to 24 to 72.2 percent.
Men are not immune from these forces, although Hispanics have the opposite effect on men's rates because Hispanic men are more likely to work than non-Hispanic men. The labor force participation rate of men aged 20 to 24 was 79.1 percent in 2005. Without Hispanic men in the mix, the age group's labor force participation would have been an even lower 77.9 percent.
Between 2000 and 2005, the labor force participation rate of women aged 20 to 24 fell 3.0 percentage points (from 73.1 to 70.1 percent). The labor force participation rate of men aged 20 to 24 fell 3.5 percentage points (from 82.6 to 79.1 percent). The rates for Hispanic men and women fell by an even larger amount—down more than 5 percentage points during those years. What explains a decline in labor force participation that is greater among men than women and greater among Hispanics (who are more likely to work in low-paying entry-level jobs) than non-Hispanics? The explanation is a weak economy.
Thursday, March 09, 2006
Will Social Security "Run Out"?
The steady stream of articles about the baby-boom generation's impending retirement often state as fact that funds in the Social Security system will run out as boomers collect their due.
Not true. America's workers will still pay into the system. Yes, the Social Security surplus will disappear, but the cash flow will continue. Even without any further changes to the system, Social Security will be able to pay 71 to 81 percent of promised benefits indefinitely.
It's also important to remember that the "pig in the python" won't be stuck there forever. Eventually, boomers will exit the system, and Social Security will swing back into a better demographic balance.
Not true. America's workers will still pay into the system. Yes, the Social Security surplus will disappear, but the cash flow will continue. Even without any further changes to the system, Social Security will be able to pay 71 to 81 percent of promised benefits indefinitely.
It's also important to remember that the "pig in the python" won't be stuck there forever. Eventually, boomers will exit the system, and Social Security will swing back into a better demographic balance.
Wednesday, March 08, 2006
How Many Are Sleepless?
The pharmaceutical industry wants to know. And the American Time Use Survey has the answer. On an average night, 3.7 percent of Americans aged 15 or older experience sleeplessness. That's 8.5 million people tossing and turning each night. Do the multiplication and you get something like 3 billion nights of sleeplessness each year in the United States, according to unpublished data from the Bureau of Labor Statistics' American Time Use Survey.
The average American gets 8.6 hours of sleep a night (including time spent tossing and turning), with teenagers getting the most (9.5 hours) and 45-to-54-year-olds the least (8.2 hours). Who is most likely to be sleepless? Women aged 65 and older.
The average American gets 8.6 hours of sleep a night (including time spent tossing and turning), with teenagers getting the most (9.5 hours) and 45-to-54-year-olds the least (8.2 hours). Who is most likely to be sleepless? Women aged 65 and older.
Monday, March 06, 2006
Bet You Didn't Know
The homeownership rate of householders under age 25 climbed from 17 to 26 percent between 1985 and 2005. The number of homeowners in the age group increased by an enormous 79 percent, to 1.7 million.
Thursday, March 02, 2006
Nothing New Here
Today's New York Times reports that, after decades of steady increases, women's labor force participation "has stalled, even slipping somewhat in the last five years and leaving it at a rate well below that of men."
Every time women's labor force participation slips a bit, out come the pundits to complete the narrative arc that so enamors those longing for the good old days—women have come to their senses and are returning home to raise their children. But a number of facts don't fit nicely into this narrative, such as:
1. Between 2000 and 2005, men's labor force participation fell MORE than women's (men: down 1.5 percentage points to 73.3 percent; women: down 0.6 percentage points to 59.3 percent).
2. Between 2000 and 2005, labor force participation rates declined for both men and women in every age group under age 55 (age groups 16-17, 18-19, and five-year age groups from 20-24 to 50-54). In four of the nine age groups under age 55, the decline in men's labor force participation was GREATER than the decline in women's participation. Isn't it probable that men's and women's rates are declining for the same reason? What is the reason, and why aren't men part of the discussion? Because it doesn't fit the story.
3. During soft economic times, women with young children will be more likely to stay home if they can afford not to work. This is not a new trend; it's just common sense. That explains why the biggest drop in women's labor force participation rate since 2000 has been among married women with preschoolers.
4. What about the impact of the growing Hispanic population on women's labor force participation? Hispanic women are less likely to work than Asian, black, or non-Hispanic white women. They account for a growing share of young adults, including 22 percent of married women under age 30. The lower participation rate of Hispanic women is no doubt depressing women's overall labor force participation. Just how much remains to be seen by someone willing to stray from the storyline.
5. The Times article comments that women's labor force participation is now stalled "far below" men’s in the same age group—implying that the "cultural transformation" brought about by working women has somehow fallen short of its goal. But this is a straw dog. No demographer has ever predicted that women's labor force participation would equal men's. Biology dictates that women will be more involved in childbearing and childrearing than men. Consequently, on average they will never participate in the labor force at the same rate as men.
6. The enormous rise in women's labor force participation rate was destined to run its course. Most women who want or need to work are now in the labor force. The small ups and downs from year to year in women's participation rate are recording only the decisions of women at the margins, not heralding a return to traditional family life.
Time for a new story.
Every time women's labor force participation slips a bit, out come the pundits to complete the narrative arc that so enamors those longing for the good old days—women have come to their senses and are returning home to raise their children. But a number of facts don't fit nicely into this narrative, such as:
1. Between 2000 and 2005, men's labor force participation fell MORE than women's (men: down 1.5 percentage points to 73.3 percent; women: down 0.6 percentage points to 59.3 percent).
2. Between 2000 and 2005, labor force participation rates declined for both men and women in every age group under age 55 (age groups 16-17, 18-19, and five-year age groups from 20-24 to 50-54). In four of the nine age groups under age 55, the decline in men's labor force participation was GREATER than the decline in women's participation. Isn't it probable that men's and women's rates are declining for the same reason? What is the reason, and why aren't men part of the discussion? Because it doesn't fit the story.
3. During soft economic times, women with young children will be more likely to stay home if they can afford not to work. This is not a new trend; it's just common sense. That explains why the biggest drop in women's labor force participation rate since 2000 has been among married women with preschoolers.
4. What about the impact of the growing Hispanic population on women's labor force participation? Hispanic women are less likely to work than Asian, black, or non-Hispanic white women. They account for a growing share of young adults, including 22 percent of married women under age 30. The lower participation rate of Hispanic women is no doubt depressing women's overall labor force participation. Just how much remains to be seen by someone willing to stray from the storyline.
5. The Times article comments that women's labor force participation is now stalled "far below" men’s in the same age group—implying that the "cultural transformation" brought about by working women has somehow fallen short of its goal. But this is a straw dog. No demographer has ever predicted that women's labor force participation would equal men's. Biology dictates that women will be more involved in childbearing and childrearing than men. Consequently, on average they will never participate in the labor force at the same rate as men.
6. The enormous rise in women's labor force participation rate was destined to run its course. Most women who want or need to work are now in the labor force. The small ups and downs from year to year in women's participation rate are recording only the decisions of women at the margins, not heralding a return to traditional family life.
Time for a new story.
Why the Decline in Homeownership?
What accounts for the decline in the homeownership rate between 2004 and 2005? One possible explanation is the economic malaise of the past few years, with incomes stagnating and poverty increasing. Another explanation could be divorce, with homeowning couples splitting into two households—one owner and one renter. Or perhaps homeowners in some markets are cashing out.
A look at the regional statistics suggests economic stagnation is the biggest factor behind the decline. The overall homeownership rate rose in the Northeast (from 65.0 to 65.2 percent) and West (from 64.2 to 64.4 percent) between 2004 and 2005—where some of the hottest housing markets are located. The rate fell a tiny bit in the South (from 70.9 to 70.8 percent). In the Midwest, however, which has been hard hit by layoffs in the manufacturing sector, the decline in homeownership was relatively steep—falling from 73.8 to 73.1 percent between 2004 and 2005.
A look at the regional statistics suggests economic stagnation is the biggest factor behind the decline. The overall homeownership rate rose in the Northeast (from 65.0 to 65.2 percent) and West (from 64.2 to 64.4 percent) between 2004 and 2005—where some of the hottest housing markets are located. The rate fell a tiny bit in the South (from 70.9 to 70.8 percent). In the Midwest, however, which has been hard hit by layoffs in the manufacturing sector, the decline in homeownership was relatively steep—falling from 73.8 to 73.1 percent between 2004 and 2005.
Wednesday, March 01, 2006
What's Up with Homeownership?
The Census Bureau just posted its 2005 annual average estimates of homeownership here. Interestingly, the nation's overall homeownership rate fell during the past year, dropping from 69.0 to 68.9 percent of households between 2004 and 2005. The homeownership rate was down slightly in almost every age group.
Since 2000, the overall homeownership rate has increased by 1.5 percentage points, with small declines in only two five-year age groups (among householders aged 50 to 54 and 65 to 69). Householders under age 25 saw their homeownership rate rise the most, up 4 percentage points between 2000 and 2005, to 26 percent. Householders aged 65 to 74 continue to have the highest homeownership rate, with 83 percent of householders in the age group owning their home.
Since 2000, the overall homeownership rate has increased by 1.5 percentage points, with small declines in only two five-year age groups (among householders aged 50 to 54 and 65 to 69). Householders under age 25 saw their homeownership rate rise the most, up 4 percentage points between 2000 and 2005, to 26 percent. Householders aged 65 to 74 continue to have the highest homeownership rate, with 83 percent of householders in the age group owning their home.
Monday, February 27, 2006
Bet You Didn't Know
According to a Pew Research Center report, 42 percent of adults with at least one living parent see or talk with a parent every day. In 1989, only 32 percent maintained daily contact with a parent.
Sunday, February 26, 2006
Olympic Medals Per Capita
The 2006 Winter Olympics is a showcase of talent for winter sports. So who came out on top? Germany may have won the most medals—29 of the 252 medals awarded at the games, but Norway beat every other country in medals per capita—an estimated 414 medals per 1 million population.
Per capita medal counts might be considered a better measure of winter sport talent since larger populations boost the probability that a country will have a top performer. By the per capita measure, Germany ranks only 12th in the medal count, with 35 medals per 1 million population. The U.S., which came in second in the overall medal count with a win of 25, ranks a lowly 21st among the 26 countries with at least one medal win, with 8 medals per 1 million population.
Some countries are so small that any win places them high in the per capita rankings. Latvia’s single medal places it ahead of most other countries by the per capita measure. On the other hand, China is so large that even if its athletes won every medal at the games it would still have only 19 medals per capita.
Below is the ranking of countries by their per capita medal count, with actual medals won shown in parentheses. (The populations used to determine the per capita count are for July 2005 and are from the CIA’s World Factbook):
COUNTRY: PER CAPITA MEDALS (ACTUAL MEDALS)
1. Norway: 414 (19)
2. Austria: 281 (23)
3. Estonia: 225 (3)
4. Switzerland: 187 (14)
5. Finland: 172 (9)
6. Sweden: 156 (14)
7. Canada: 73 (24)
8. Croatia: 67 (3)
9. Netherlands: 55 (9)
10. Latvia: 44 (1)
11. Czech Republic: 39 (4)
12. Germany: 35 (29)
13. South Korea: 23 (11)
14. Italy: 19 (11)
15. Slovakia: 18 (1)
16. Russia: 15 (22)
17. France: 15 (9)
18. Bulgaria: 13 (1)
19. Australia: 10 (2)
20. Belarus: 10 (1)
21. United States: 8 (25)
22. Poland: 5 (2)
23. Ukraine: 4 (2)
24. United Kingdom: 2 (1)
25. China: 1 (11)
26. Japan: 1 (1)
Per capita medal counts might be considered a better measure of winter sport talent since larger populations boost the probability that a country will have a top performer. By the per capita measure, Germany ranks only 12th in the medal count, with 35 medals per 1 million population. The U.S., which came in second in the overall medal count with a win of 25, ranks a lowly 21st among the 26 countries with at least one medal win, with 8 medals per 1 million population.
Some countries are so small that any win places them high in the per capita rankings. Latvia’s single medal places it ahead of most other countries by the per capita measure. On the other hand, China is so large that even if its athletes won every medal at the games it would still have only 19 medals per capita.
Below is the ranking of countries by their per capita medal count, with actual medals won shown in parentheses. (The populations used to determine the per capita count are for July 2005 and are from the CIA’s World Factbook):
COUNTRY: PER CAPITA MEDALS (ACTUAL MEDALS)
1. Norway: 414 (19)
2. Austria: 281 (23)
3. Estonia: 225 (3)
4. Switzerland: 187 (14)
5. Finland: 172 (9)
6. Sweden: 156 (14)
7. Canada: 73 (24)
8. Croatia: 67 (3)
9. Netherlands: 55 (9)
10. Latvia: 44 (1)
11. Czech Republic: 39 (4)
12. Germany: 35 (29)
13. South Korea: 23 (11)
14. Italy: 19 (11)
15. Slovakia: 18 (1)
16. Russia: 15 (22)
17. France: 15 (9)
18. Bulgaria: 13 (1)
19. Australia: 10 (2)
20. Belarus: 10 (1)
21. United States: 8 (25)
22. Poland: 5 (2)
23. Ukraine: 4 (2)
24. United Kingdom: 2 (1)
25. China: 1 (11)
26. Japan: 1 (1)
Friday, February 24, 2006
Why Can't Americans Save Money?
Results of the 2004 Survey of Consumer finances, released yesterday by the Federal Reserve Board, show a decline in the proportion of households that are saving money. From 59.2 percent in 2001, the proportion saving money during the past year fell to 56.1 percent in 2004. (The survey asked respondents whether their household spent more than their income, the same as their income, or less than their income during the past year. Those who spent less than their income were classified as savers.) Even more ominous given the aging of the population, the percentage of households with retirement accounts fell from 52.2 to 49.7 percent between 2001 and 2004.
This is only the latest evidence of the American struggle to save. Other research has shown participation in retirement savings plans to be woefully inadequate. An analysis by the Employee Benefit Research Institute (EBRI) reveals that a 40 percent minority of workers participate in a 401(k)-type plan or own an IRA. Another study by EBRI finds only 4.5 percent of workers made a tax-deductible contribution to an IRA in 2002, down from 6.5 percent in 1992.
The 2005 Retirement Confidence Survey finds only 25 percent of workers "very" confident in having enough money to afford a comfortable retirement. No wonder: The 52 percent majority have saved less than $25,000. Even among workers aged 45 or older, most have saved less than $50,000.
Why can't Americans save more? Many factors play a role, such as:
--The steep rise in the cost of necessities such as health insurance. Who can afford to save?
--Economic insecurity. When jobs are tenuous, saving seems like an unaffordable luxury.
--Stock market volatility. Why invest when it might vanish tomorrow?
--Low interest rates. Might as well put your money under the mattress.
--The voluntary nature of retirement savings. Why not wing it and hope for the best?
For too many Americans, their retirement savings plan appears to be a lottery ticket.
This is only the latest evidence of the American struggle to save. Other research has shown participation in retirement savings plans to be woefully inadequate. An analysis by the Employee Benefit Research Institute (EBRI) reveals that a 40 percent minority of workers participate in a 401(k)-type plan or own an IRA. Another study by EBRI finds only 4.5 percent of workers made a tax-deductible contribution to an IRA in 2002, down from 6.5 percent in 1992.
The 2005 Retirement Confidence Survey finds only 25 percent of workers "very" confident in having enough money to afford a comfortable retirement. No wonder: The 52 percent majority have saved less than $25,000. Even among workers aged 45 or older, most have saved less than $50,000.
Why can't Americans save more? Many factors play a role, such as:
--The steep rise in the cost of necessities such as health insurance. Who can afford to save?
--Economic insecurity. When jobs are tenuous, saving seems like an unaffordable luxury.
--Stock market volatility. Why invest when it might vanish tomorrow?
--Low interest rates. Might as well put your money under the mattress.
--The voluntary nature of retirement savings. Why not wing it and hope for the best?
For too many Americans, their retirement savings plan appears to be a lottery ticket.
Thursday, February 23, 2006
More Gold from Wealth Survey
Results from the long-awaited 2004 Survey of Consumer Finances were released by the Federal Reserve Board this morning, and number crunchers everywhere are drooling over the tables. It's a good thing the findings are so tasty because we will have to gnaw on them for the next three years.
NET WORTH: Household net worth (assets minus debts) barely increased between 2001 and 2004 (up 1.5 percent). Even worse, the net worth of householders aged 35 to 44 plunged by 16 percent during those years, after adjusting for inflation (falling from $82,600 to $69,400). Why? Their financial assets lost value, they took on more debt, and the small increase in the value of their nonfinancial assets (read: homes) did not make up the difference.
FINANCIAL ASSETS: The average household lost a lot of ground here. The median value of the financial assets owned by the average household fell 23 percent between 2001 and 2004, after adjusting for inflation--from a median of $29,800 to $23,000. A smaller 48.6 percent of households owned stock in 2004, down from 51.9 percent in 2001. Among families owning stock both directly and indirectly through mutual funds and retirement accounts, median stock value fell from $36,700 to $24,300. Financial assets as a share of total assets fell from 42 to 36 percent.
NON-FINANCIAL ASSETS: The rise in homeownership can be seen in these numbers. The homeownership rate increased from 67.7 to 69.1 percent between 2001 and 2004. The median value of the average household's nonfinancial assets (including homes) rose 22 percent from$120,900 to $147,800, after adjusting for inflation. The median value of the average household's primary residence climbed 22 percent, from $131,000 to $160,000.
DEBT: Not surprisingly, Americans are deeper in debt. The median amount of debt for households with debt (76 percent of households) rose by 34 percent between 2001 and 2004, from $41,300 to $55,300 after adjusting for inflation. Seventy percent of debt is for home purchase. Credit card debt remains modest. Forty-six percent of households carried a balance on their credit card, owing a median of just $2,200 in 2004.
NET WORTH: Household net worth (assets minus debts) barely increased between 2001 and 2004 (up 1.5 percent). Even worse, the net worth of householders aged 35 to 44 plunged by 16 percent during those years, after adjusting for inflation (falling from $82,600 to $69,400). Why? Their financial assets lost value, they took on more debt, and the small increase in the value of their nonfinancial assets (read: homes) did not make up the difference.
FINANCIAL ASSETS: The average household lost a lot of ground here. The median value of the financial assets owned by the average household fell 23 percent between 2001 and 2004, after adjusting for inflation--from a median of $29,800 to $23,000. A smaller 48.6 percent of households owned stock in 2004, down from 51.9 percent in 2001. Among families owning stock both directly and indirectly through mutual funds and retirement accounts, median stock value fell from $36,700 to $24,300. Financial assets as a share of total assets fell from 42 to 36 percent.
NON-FINANCIAL ASSETS: The rise in homeownership can be seen in these numbers. The homeownership rate increased from 67.7 to 69.1 percent between 2001 and 2004. The median value of the average household's nonfinancial assets (including homes) rose 22 percent from$120,900 to $147,800, after adjusting for inflation. The median value of the average household's primary residence climbed 22 percent, from $131,000 to $160,000.
DEBT: Not surprisingly, Americans are deeper in debt. The median amount of debt for households with debt (76 percent of households) rose by 34 percent between 2001 and 2004, from $41,300 to $55,300 after adjusting for inflation. Seventy percent of debt is for home purchase. Credit card debt remains modest. Forty-six percent of households carried a balance on their credit card, owing a median of just $2,200 in 2004.
Federal Reserve Releases New Wealth Data
The Federal Reserve Board released the long-awaited update of the triennial Survey of Consumer Finances at 9:30 this morning. It is available here.
The Survey of Consumer Finances is the only comprehensive look at the wealth of American households over time and by demographic characteristic. The last survey was fielded in 2001, before the 9/11 terrorist attacks and consequent economic disruptions. So what has happened to the wealth of Americans since then? Bottom line: Median household net worth inched up by only 1.5 percent between 2001 and 2004--from $91,700 to $93,100, after adjusting for inflation. This compares with a gain of 17 percent between 1995 and 1998 and 10 percent between 1998 and 2001.
Stay tuned for more analysis...
The Survey of Consumer Finances is the only comprehensive look at the wealth of American households over time and by demographic characteristic. The last survey was fielded in 2001, before the 9/11 terrorist attacks and consequent economic disruptions. So what has happened to the wealth of Americans since then? Bottom line: Median household net worth inched up by only 1.5 percent between 2001 and 2004--from $91,700 to $93,100, after adjusting for inflation. This compares with a gain of 17 percent between 1995 and 1998 and 10 percent between 1998 and 2001.
Stay tuned for more analysis...
Friday, February 17, 2006
Boomer Story Takes a Turn
This should give you pause: During the next 15 years, the baby-boom generation will shrink by 10 percent. Between 2005 and 2020, the number of Americans born between 1946 and 1964 will fall from 78 million to 70 million, according to Census Bureau projections. Soon, boomers will no longer be the largest generation. That dubious honor will pass to the millennial generation, born between 1977 and 1994.
The big shrink begins when boomer deaths outnumber gains from immigration. My estimates show we have passed the tipping point. Immigrants in the baby-boom age group boost the boomer population by about 200,000 a year. Right now, deaths are trimming boomers by a slightly larger 223,000. Deaths will outnumber immigrants by a rapidly expanding margin with each passing year.
The older generations of Americans are already in steep decline. The number of people in what we call the Swing (born between 1933 and 1945) and World War II generations (born before 1933) will fall by more than half during the next 15 years, plummeting from 50 million in 2005 to 23 million in 2020.
The big shrink begins when boomer deaths outnumber gains from immigration. My estimates show we have passed the tipping point. Immigrants in the baby-boom age group boost the boomer population by about 200,000 a year. Right now, deaths are trimming boomers by a slightly larger 223,000. Deaths will outnumber immigrants by a rapidly expanding margin with each passing year.
The older generations of Americans are already in steep decline. The number of people in what we call the Swing (born between 1933 and 1945) and World War II generations (born before 1933) will fall by more than half during the next 15 years, plummeting from 50 million in 2005 to 23 million in 2020.
Wednesday, February 15, 2006
Bet You Didn't Know
Poverty rate of the elderly in 2004: 9.8%
Poverty rate of the elderly if there were no Social Security benefits: 41.1%
Poverty rate of the elderly if there were no Social Security benefits: 41.1%
Cool Research Link: Spending Anthology
Want to know how the 9/11 terrorist attacks affected household spending on airline fares? You can find out in the 2005 Consumer Expenditure Survey anthology. Household spending on air travel was at a peak of $8.9 billion in the third quarter of 2001 and fell by an eye-popping 31 percent to $6.1 billion in the fourth quarter. The oldest householders (aged 65 or older) cut their spending on airline fares more than any other age group.
Thursday, February 09, 2006
Bet You Didn't Know
Among people aged 18 to 64, only 45 percent have health insurance through their own employer.
Tuesday, February 07, 2006
Q & A: How Many Americans are Gay?
Believe it or not, the government asks and tells. According to recently released results from the 2002 National Survey of Family Growth (NSFG), nine out of ten people aged 15 to 44 (the survey is limited to that age group) identify themselves as heterosexual. The proportions are almost identical for men (90.2 percent) and women (90.3 percent) and do not vary significantly by age within the 15-to-44 age group.
Does this mean the remaining 10 percent are homosexual? Maybe, but it's hard to say. The government allows respondents to identify themselves as homosexual, bisexual, or "something else." Among men aged 15 to 44, only 2.3 percent identify themselves as homosexual, 1.8 percent say they are bisexual, 3.9 percent say they are something else, and 1.8 percent did not answer the question. Among women the proportions are 1.3 percent homosexual, 2.8 percent bisexual, 3.8 percent something else, and 1.8 percent refused to answer. Just what is "something else"? According to the government report Sexual Behavior and Selected Health Measures: Men and Women 15-44 Years of Age, United States, 2002, some of those saying they are something else may not understand the terminology. So the 10 percent figure may be too large—or maybe not.
The NSFG explores sexual orientation in other ways as well. It asks respondents whether they are attracted more to people of the same sex or the opposite sex. It also asks about lifetime and past-year sexual contact with opposite-sex and same-sex partners. On the attraction question, 92 percent of men aged 15 to 44 say they are attracted only to females—more than the 90 percent of men who say they are heterosexual. Among women, 86 percent say they are attracted only to males—less than the 90 percent who say they are heterosexual. Six percent of men say they have had oral or anal sex with another man in their lifetime. A smaller 2.9 percent say they have done so in the past 12 months. Eleven percent of women say they have had a sexual experience with another woman in their lifetime, and 4.4 percent have done so in the past year (the survey asked men and women different questions regarding same-sex experiences, making it difficult to compare results by gender).
It's likely that many people do not want the government to know their sexual leanings—especially if they are gay. The NSFG interviews were conducted in a way to minimize this hesitancy. Respondents wore headphones and entered their responses into a computer, preventing the interviewer from knowing how they answered the questions. Nevertheless, there's little doubt homosexuality will be under-reported, making the 10 percent figure as good a guess as any.
Does this mean the remaining 10 percent are homosexual? Maybe, but it's hard to say. The government allows respondents to identify themselves as homosexual, bisexual, or "something else." Among men aged 15 to 44, only 2.3 percent identify themselves as homosexual, 1.8 percent say they are bisexual, 3.9 percent say they are something else, and 1.8 percent did not answer the question. Among women the proportions are 1.3 percent homosexual, 2.8 percent bisexual, 3.8 percent something else, and 1.8 percent refused to answer. Just what is "something else"? According to the government report Sexual Behavior and Selected Health Measures: Men and Women 15-44 Years of Age, United States, 2002, some of those saying they are something else may not understand the terminology. So the 10 percent figure may be too large—or maybe not.
The NSFG explores sexual orientation in other ways as well. It asks respondents whether they are attracted more to people of the same sex or the opposite sex. It also asks about lifetime and past-year sexual contact with opposite-sex and same-sex partners. On the attraction question, 92 percent of men aged 15 to 44 say they are attracted only to females—more than the 90 percent of men who say they are heterosexual. Among women, 86 percent say they are attracted only to males—less than the 90 percent who say they are heterosexual. Six percent of men say they have had oral or anal sex with another man in their lifetime. A smaller 2.9 percent say they have done so in the past 12 months. Eleven percent of women say they have had a sexual experience with another woman in their lifetime, and 4.4 percent have done so in the past year (the survey asked men and women different questions regarding same-sex experiences, making it difficult to compare results by gender).
It's likely that many people do not want the government to know their sexual leanings—especially if they are gay. The NSFG interviews were conducted in a way to minimize this hesitancy. Respondents wore headphones and entered their responses into a computer, preventing the interviewer from knowing how they answered the questions. Nevertheless, there's little doubt homosexuality will be under-reported, making the 10 percent figure as good a guess as any.
Subscribe to:
Posts (Atom)