Census Reports Slight Increase in Incomes, said the headline in Rick Lyman’s front-page story in the New York Times today. Bush officials smile even wider, with a spokeswoman for Bill Frist saying the data show the economy remains strong.
A few alternative headlines would have captured the data better: Families get ahead only by working more:
Same work, less money
5.9% decline in families’ incomes since 1999
One-Earner Families Squeezed Harder
Number of Uninsured Increase 1.3 million 2004-2005
The Times commissioned a report analyzing newly released Census data. It is a thoughtful, reliable account of a study by a reputable group. But to describe the rise in family income as a glimmer of improvement when it was accomplished only by putting more people in the workforce is just plain wrong.
When more people work, household incomes should go up. Of course, expenses will go up too if these new workers have to pay for gasoline, buy clothes, eat lunches or put children in daycare. By the time all the costs financial and otherwise are included, it is fair to say that an increase in family income that is driven entirely by putting more people in the household tells us very little about the rising or declining total fortunes of the family.
My coauthor (and daughter) Amelia Warren Tyagi and I wrote a book about these harder-working, but not better-living two-income families, The Two-Income Trap: Why Middle Class Mothers and Fathers Are Going Broke. The New York Times data are just the microcosm of a trend started in the 1970s the only way middle class families can keep up with rising expenses is to send more people into the workforce.
What the headline doesn’t say is that workers are participating in rising productivity. It doesn’t say is that even a tiny bit larger share of corporate earnings are going to workers. It doesn’t say that after accounting for inflation, a fully-employed male is making a little more money than he was making in 1972. It doesn’t say those things because they aren’t true.
The study also includes data on poverty. Perhaps they deserve their own headlines. The same number of people remained in poverty over the past year. (Smiley face headline: Despite current policies, the number in poverty didn’t grow!) And the fact that those in poverty actually got poorer. (Smiley face headline: The poor now have more incentives to work!)
Ah, the power of the headline.
