ECONOMIC REPORT OF THE PRESIDENT

Figure 2-35
Growth in Real Household Income by Percentile, 2014–2015
Percent Change from Prior Year
8
7
6
Median
5
4
3
2
1
0
10th 20th 40th 50th 60th 80th 90th 95th
Percentiles
Source: Census Bureau; CEA calculations.
faster than inflation, translating into sustained real wage gains for American
workers.
Real average hourly earnings of production and nonsupervisory
workers have grown at a relatively high rate in 2016. As of October, real
wages of production and nonsupervisory workers have grown at an annual
rate of 0.8 percent since the start of the current business cycle in December
2007, which is the fastest real wage growth over a business cycle since the
early 1970s (Figure 2-33). From October 2012 to October 2016, the total
growth of real wages of private production and nonsupervisory workers was
6.1 percent, exceeding the 2.1-percent total growth from the business cycle
peak in 1980 to the business cycle peak in 2007.
The combination of strong employment gains and real wage gains
have contributed to rising real household income. Real median household
income rose 5.2 percent, to $56,516 in 2015. This was the largest percent
increase since records began in 1967. The income gains were broad based:
for the first time since 2006, all income percentiles reported by the U.S.
Census Bureau experienced gains (Figure 2-34). The largest gains were
among households at the bottom of the income distribution; real income
growth was the fastest on record for the 10th, 20th, 40th, 50th, and 60th
percentiles (Figure 2-35). In addition, all racial and ethnic groups saw
124 | Chapter 2