Income distribution in North Carolina

The national media has given lots of coverage to the increasing gap in recent years between the highest-income and lowest-income households. Is that same trend occurring in North Carolina? N.C. State University economist Mike Walden responds.

“I recently looked at trends in income categories in North Carolina over the last five years — specifically, from 2007, before the recession, to 2012, the latest year we have data for. I divided households in the three categories: Those earning between $0 and $35,000; those with $35,000 to $75,000 in income; and then those above $75,000.

“I should say these numbers — these data — include not only what people earn but any benefits they might receive from the government. And what I found over that time period is, for the lower-income category, not much change in the percentage of households there. In the middle-income category, however, there was a significant drop — a noticeable drop — in the percentage of households who we would define as middle income. And in the upper-income category, there was an increase.

“So I think what I think you can say here is the sort of the glue in the income categories — that middle-income category — those folks are becoming less a prominent in our economy, and you really see an economy where you have a large number people of the low end of the payscale, a large number people on the high end of the pay scale, and not as many in between.

“Of course, this has all kinds of implications, both social and economic.”

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