A report by the US Census Bureau this week shows that household income is up, the poverty rate is slightly down for the first time this decade, but the number of people without health insurance went up by 0.5 per cent to reach 47 million in 2006.

The Income, Poverty, and Health Insurance Coverage in the United States: 2006 report draws on information collected in two surveys: the 2007 Current Population Survey (CPS) Annual Social and Economic Supplement (ASEC).

There has been a strong reaction to the report, with the presidential elections coming up next year, the New York Times describes it as a "presidential candidate's gold mine", with the main focus being on the fact that 47 million Americans still have no health insurance and the proportion of children with no health insurance has risen, with the poorest children the most likely to be uninsured.

This has boosted calls by many candidates to bring more people into the government scheme. Recently the government based schemes have received wide support in Congress even though President Bush has promised to veto any legislation that expands them.

Bush chose to highlight the fact the report shows American household income is rising and poverty is going down albeit only slightly and only for the first time this decade. He conceded however that there remains a challenge to reduce the number of Americans without health insurance, choosing to stress that the best route to this is to make it more affordable rather than bring more into the government scheme.

According to the report, real household income in the US rose by 0.7 per cent from 47,845 dollars in 2005 to 48,201 dollars in 2006 (based on the median figure, a kind of average that pinpoints the middle of the range from the highest to the lowest). This is the second consecutive year the figure has gone up.

This is in contrast to the decrease in real median earnings of both men and women who work full time all year round. This went down in 2006 compared to 2005 by 1.1 and 1.2 per cent respectively. The downward trend in real median earnings for this group has now gone down three years in a row.

Women are still earning less that men on average and the ratio of female to male earnings stayed at 0.77 between 2005 and 2006. This figure hovered at around 0.6 from 1960 to 1980 and climbed steadily in the 25 or so years since.

In terms of income per head of the population, this went up between 2005 and 2006 for all race groups and Hispanics, with Asians showing the largest increase.

The official poverty rate has fallen from 12.6 per cent in 2005 (37.4 million people) to 12.3 per cent in 2006 (36.5 million). This is the first time it has fallen this decade.

More recently, in 2000 the poverty rate stood at 11.3 per cent, then rose to 12.1 and 12.5 per cent in 2002 and 2003.

The poverty rate and numbers in poverty for the under 18s have remained statistically unchanged between 2005 and 2006 (17.4 per cent and 12.8 million), as they have for the 18 to 64 year olds (10.8 per cent and 20.2 million). However there is better news for seniors, both the poverty rate and the number in poverty have gone down for the over 64 year olds, from 10.1 per cent (3.6 million) in 2005 to 9.4 per cent (3.4 million) in 2006.

The income and poverty estimates do not include the value of non cash benefits such as food stamps, Medicare and Medicaid, public housing and fringe benefits from employers. Alternative measures of income and poverty that show the effect of taxes and certain non cash benefits will be published later said the report.

Both the percentage and number of people without health insurance coverage went up from 15.3 per cent in 2005 (44.8 million) to 15.8 per cent (47 million) in 2006. This figure has been rising gradually by one or two tenths of a per cent for the last 20 years according to the graph shown in the report.

Within these figures, the proportion covered by employment based schemes went down from 60.2 per cent in 2005 to 59.7 per cent in 2006, as did the proportion covered by government schemes which decreased from 27.3 per cent in 2005 to 27.0 per cent in 2006.

The percentage and number of children under 18 who are not insured has gone up from 10.9 per cent (8.0 million) in 2005 to 11.7 per cent (8.7 million) in 2006. With 19.3 per cent of children in poverty having no insurance, this puts the chances of a child in poverty of having no health insurance at a higher rate than all children in the population.

However, the number of people with health insurance also went up from 249.0 million in 2005 to 249.8 million in 2006, which is possible at the same time as the rise in numbers without health insurance because the US population is expanding.

Within these figures there are variations across demographic groups. For instance, the median incomes of white households went up in 2006 compared to 2005, but stayed the same for other races and Hispanics. The poverty rate went down for Hispanics, but remained the same for non-Hispanic Whites, Blacks and Asians. The proportion of people with no health insurance went up for Hispanics, down for Asians and stayed the same for non-Hispanic Whites and Blacks.

Also published this week is the 2006 American Community Survey (ACS), which covers states and metropolitan areas, counties, cities and American Indian/Alaska Native areas with populations of 65,000 or higher, and all congressional districts. And for the first time the report covers groups such as prisoners, students living in college dorms, serving men and women living in military barracks and residents of nursing homes.

"Income, Poverty, and Health Insurance Coverage in the United States: 2006."
Carmen DeNavas-Walt, Bernadette D. Proctor, Jessica Smith
US Census Bureau, Report No P60-233, August 2007

Click here for the full report (PDF reader required).

Written by: Catharine Paddock