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The U.S. Census Bureau employs several yardsticks to compile data about the population, unemployment, income, demographics, etc. To compile data regarding the average income, the terms 'household income' and 'per capita income' are commonly used.

Although many people think of 'average income' as an indicator of the economic health of the citizens of the US, economists rely on the concept of 'median income' for their research. One of the prime reasons for this is the fact that average income can vary to a large extent, on account of the huge gap between the highest earners and the lowest earners in a country. Median income, on the other hand, provides a more realistic and accurate estimate of the earnings of a population. For example, around 0.1% of the total population of US has an annual income exceeding $1.5 million a year. This negligible section of the total population skews the average income, providing an unfair idea of how average Americans are faring economically. To counter the unreliability of this economic indicator, the concept of median household income is employed.

Household income is the sum of all the income earned by the members of a household aged 15 and above. Income includes,
  • Wages and Salaries
  • Unemployment Insurance
  • Disability Payments
  • Child Support Payments Received
  • Regular Rental Receipts
  • Personal Business
  • Investment Returns
Per capita income is defined as the income earned by all the people in a particular area divided by the total population in that area. For example, in a geographical area of 20 people, if 10 people earn $1000 each and the remaining 10 people earn $2000 each, the per capita income will be $1500.

The U.S. Census Bureau calculates the median household income and median per capita income after getting the required data about the population and their total income. In 2011, the median household income dropped by 1.7% from $51,144 to $50,502. The median per capita income for the year 2011 stood at $41,560. The data for the year 2012 will be published by the U.S. Census Bureau this year.

Median Income in America

StateMedian Per Capita IncomeMedian Household Income
Alabama34,88041,415
Alaska45,66567,825
Arizona35,06246,709
Arkansas33,74038,758
California43,64757,287
Colorado44,05355,387
Connecticut57,90265,753
Delaware41,44958,814
Dist. of Col.73,78363,124
Florida39,63644,299
Georgia35,97946,007
Hawaii42,92561,821
Idaho32,88143,341
Illinois43,72153,234
Indiana35,68946,438
Iowa41,15649,427
Kansas40,88348,964
Kentucky33,98941,141
Louisiana38,54941,734
Maine38,29946,033
Maryland50,65670,004
Massachusetts53,47162,859
Michigan36,26445,981
Minnesota44,56056,954
Mississippi32,00036,919
Missouri37,96945,247
Montana36,01644,222
Nebraska42,45050,296
Nevada36,96448,927
New Hampshire45,88162,647
New Jersey52,43067,458
New Mexico34,13341,963
New York51,12655,246
North Carolina36,02843,916
North Dakota47,23651,704
Ohio37,83645,749
Oklahoma37,67943,225
Oregon37,52746,816
Pennsylvania42,29150,228
Rhode Island43,87553,636
South Carolina33,38842,367
South Dakota44,21748,321
Tennessee36,56741,693
Texas40,14749,392
Utah33,50955,869
Vermont41,57252,776
Virginia46,10761,882
Washington43,87856,835
West Virginia33,40338,482
Wisconsin39,57550,395
Wyoming47,89856,322
USA41,56050,502

(All figures are in USD, and are for the year 2011. Figures have been adjusted for inflation.)

The income distribution in the United States has been a highly debated topic, especially after the recession of 2007-08. In 2012, people, infuriated with government policy of bailing out multi-billion dollar corporations with public money, camped outside the Wall Street to lodge their protest. Various reports over the years have stated that America's wealth distribution is flawed, and a handful of politicians and entrepreneurs hold the reins of the entire American economy. Although the government has promised to lessen the gap between the rich and the poor, the ground reality is that the rich are getting richer, and the poor are struggling to find a foothold in post-recession America.