ROANOKE TIMES
Copyright (c) 1996, Roanoke Times
DATE: Friday, September 27, 1996 TAG: 9609270054
SECTION: BUSINESS PAGE: A-9 EDITION: METRO
DATELINE: WASHINGTON
SOURCE: Knight-Ridder/Tribune
Riding a growing economy, household income rose last year for the first time in six years, and poverty in America declined for the second year in a row, the Census Bureau reported Thursday.
The median - or midpoint - household income was $34,076 in 1995, a gain of nearly 3 percent from 1994. The poverty rate declined, from 14.5 percent in 1994 to 13.8 percent in 1995.
In Virginia, median household income fell to $36,222 in 1995, down 6.4 percent from $38,714, the new report said.
About 36 million Americans lived below the official poverty line - $12,158 for a family of three.
Yet despite these improvements, Americans still were not as well off as before the 1990-1991 recession. After more than five years of economic expansion, median household income remained about 4 percent below its 1989 inflation-adjusted peak of $35,526.
The Census reports - based on a survey of 50,000 households - are an annual snapshot of the nation's economic well-being. The myriad of statistics becomes fodder for debates on everything from workers' wages to retirees' benefits.
One statistic that will raise eyebrows: In a potentially historic shift, the poverty rate for the elderly dipped below that of working-age people for the first time ever.
In 1995, 10.5 percent of the elderly were poor, compared with 11.4 percent of people aged 18-64. Nearly 24 percent of children under 6 were living in poverty.
Poverty among the elderly has fallen dramatically since the early '60s, thanks to federal programs such as Social Security and Medicare, as well as better private pensions.
President Clinton said the Census numbers are one more sign that his economic policies are working. ``The news is remarkably good,'' Clinton said. ``Today it is clear that more and more of our people are sharing in ... prosperity.''
Republican presidential candidate Bob Dole said the statistics show only ``anemic'' growth, and said his plan to cut taxes and balance the budget would build a more productive economy.
The Census data also showed that the polarization of incomes in America has slowed. Over the last two decades, wealthy families have reaped an increasing share of total income, while the shares going to the middle class and the poor have declined. For the second year in a row, there was virtually no change in inequality.
``It's too soon to say whether this is a permanent flattening out, or even the beginning of a decline,'' said Daniel Weinberg, a senior Census statistician.
The improvements for 1995 were not evenly spread throughout the country. Much of the gain in incomes and drop in poverty was concentrated in the Midwest, where manufacturing is still booming. Household income jumped 7 percent in the Midwest, while other regions basically held their own. Nationwide, the earnings of year-round, full-time workers were flat for men, and declined slightly for women.
``If median income is going to rise anywhere, it's going to be the Midwest,'' said Ned Hill, an economist at Cleveland State University. ``Just think of all the auto plants running overtime.''
Among states, Colorado, Illinois, Iowa, Kentucky, Maine, Mississippi, Missouri, Pennsylvania, Tennessee, Texas, and Wisconsin had significant increases in income.
Black households posted bigger income gains than white households, but Hispanic households lost ground. On the whole, blacks still earned less than whites, but the gap narrowed. Health insurance coverage was unchanged, with 40 million Americans not covered.
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