Noted in yesterday’s look at how median household incomes are finally rising was that, at least nationally, the lowest incomes increased by the largest amount. That was based on the CPS data available for the U.S. In the ACS data, which we have at the local level you can do something similar as well, which brings us to the latest edition of the Graph of the Week.
In 2015, incomes for Oregonians in the bottom quintile — the 20% of households making approximately less than $23,000 per year — increased by the largest percent. This amounted to nearly a 7 percent increase after accounting for inflation. Gains were relatively even for the rest of the income distribution. In fact this pattern of strong gains at the bottom end, plus relatively even gains for everyone else is seen in Oregon data since the depths of the recession, or so far in recovery. These gains are predominantly due to the improving labor market where wage gains are increasing as the market becomes tight.
UPDATE: The graph below and percentages listed were incorrectly calculated in the original post. The issue was using the wrong year for inflation-adjustment. What follows is a corrected version. The overall story remains the same, although the exact details do differ. Apologies for the error.
However, when looking at income changes from before the Great Recession through today, there is a clear pattern. Those at the highest income levels have seen the best performance. Inflation-adjusted incomes for the top 20% are now nearly 7 percent above their pre-Great Recession peaks. The top 5% have fared even better with gains of 8.1%. On the other hand, incomes for the bottom 20%, even after the big jump in 2015, remain 6.5% below where they were in 2007.
Our office is still unpacking and dissecting the latest data. Stay tuned for more updates in the coming weeks.
Mark McMullen
Josh Lehner
Oregon Office of Economic Analysis 
A useful follow up article might explore the causes of the 2007-2015 decline in income for the lowest quintile, while the top quintile experienced no such decline in income. Presumably, the bottom quintile is composed of mostly hourly workers who’s pay would be affected by loss of over time and/or a reduced work week, whereas the top quintile would be composed mostly of salaried employees who’s base pay would be largely unaffected. Adding in incentive pay might also add some texture to your figures, especially at the top quintile where incentives may be significant.
By: Scott Boone on September 20, 2016
at 10:33 AM
It would be interesting to see what the change in total households in each of the income categories has been during those same time periods.
Have any of the segments grown in numbers of household or have any of them declined in number of households?
JAKE SHAFER
By: Jake Shafer on September 21, 2016
at 10:12 PM
Hi Jake, Thanks for the comment. Will post that here in a minute. That is actually a very big key to the growth we have seen, particularly in the metro areas. On net, household growth is predominately at the high end of the scale. Now, most household still are in the middle income brackets, but the growth is skewed toward the top end. This is not just migrants, but also Oregonian households who receive raises, find a job, etc. This has big implications for housing and the demand for luxury housing units, which is what is being built today.
By: Josh Lehner on September 22, 2016
at 9:12 AM
[…] culpa. A couple weeks ago when discussing the latest median household income trends, I used the wrong inflation adjustment, […]
By: More on Household Income Growth | Oregon Office of Economic Analysis on October 11, 2016
at 9:32 AM