Tim Moffit's  Instablog

Tim Moffit
Send Message
I have been an economics and finance professor for the past 25 years at Kalamazoo College, in Kalamazoo, Michigan. I invest only for my personal account as a part-time investor. My bachelors degree is in economics from Kalamazoo College. My masters degree, MBA, is in general management from... More
My company:
tem Companies
My blog:
  • Five Predictions For 2014: #5 0 comments
    Jan 14, 2014 11:19 AM

    Prediction #5: Real Disposable Median Household Income Will Continue to Decline.

    My guess is another $300 to $500 reduction.

    Here is real disposable median household income for the past six years:

    2007 = $56,189
    2008 = $55,484
    2009 = $53,760...
    2010 = $52,703
    2011 = $51,557
    2012 = $51,371
    2013 = $51,500 (author's estimate)

    Household income, adjusted for inflation, is down about 8 percent from pre-Great Recession levels. Clearly, households, as measured by median income, are not better off, and the trend continues to point to lower and lower levels, even though we are five years post-recession. Some data sets will show a marginal 2% improvement over the past two years. Other data sets point to continued declines.

    My prediction: the median household will not be better off next year; in fact, it will be worse off, because of 1) increasing taxes and their impact on after-tax, take-home pay, and 2) the increased personal costs of ACA health care costs, and 3) commodity price increases to the individual worker.

    The saving grace could be a bump in real wages and hours worked, but I am not holding my breath, as hours and wages continue to suffer from persistent employer jitters.

Back To Tim Moffit's Instablog HomePage »

Instablogs are blogs which are instantly set up and networked within the Seeking Alpha community. Instablog posts are not selected, edited or screened by Seeking Alpha editors, in contrast to contributors' articles.

Comments (0)
Track new comments
Be the first to comment
Full index of posts »
Latest Followers


More »
Instablogs are Seeking Alpha's free blogging platform customized for finance, with instant set up and exposure to millions of readers interested in the financial markets. Publish your own instablog in minutes.