Black household income plunges in one year in Minnesota

Household income for blacks in Minnesota plummeted in the past year, according to survey data released Thursday by the U.S. Census Bureau.

From 2013 to 2014, the median income for black households in the state fell 14 percent. In constant dollars, that was a decline from about $31,500 to $27,000 — or $4,500 in a single year.

Meanwhile, the statewide poverty rate for black residents rose from 33 percent to 38 percent, compared to a stable overall state poverty rate of 11 percent.

The median black household in Minnesota is now worse off than its counterpart in Mississippi. Among the 50 states, along with Puerto Rico and Washington, D.C., Minnesota ranked 45th in median black household income. Mississippi ranked 44th.

Income and poverty for other racial groups in Minnesota — whites, Hispanics and Asians — remained stable. Only blacks saw a worsening of income and poverty.

"It's alarming," said Steven Belton, interim president and CEO of the Minneapolis Urban League. "It's a deepening of the income disparity, not only across the state but across the nation. When you pair that with the continuing disparities we have in education, health and wealth, it's disturbing.

"The alleged rising tide has not lifted all boats."

Gov. Mark Dayton said he couldn't respond to the report because he wasn't given enough time to address the complicated issue.

"It is extremely unfair to contact our office on such an important and complex matter and provide two hours for a response," Dayton said in a statement released by a spokesperson.

Other state officials called the data on income and poverty "significant," and said they'd have to study the numbers further before they could speculate on the causes.

But it's clear that economic security for Minnesota's black families remains an unachieved goal, said Steve Hine, research director for the Department of Employment and Economic Development.

"This is evidence that we're still moving in the wrong direction in that respect," he said. "This economic security gap that we're facing along racial divides is clearly persisting — and, at first glance, may even be worsening rather than improving as our economy recovers."

Nationally, the American Community Survey showed that income and poverty were generally stable over the entire U.S. population. Poverty rates remained stable in 36 states and the District of Columbia, while about a dozen states saw a decline in their poverty rates. Mississippi (21.5 percent) and New Mexico (21.3) had the highest overall poverty rates.

Read more about the American Community Survey here.

The U.S. median household income — meaning half made more and half made less — was $53,657. North Dakota led the nation with the largest significant increase, jumping from about $56,600 to about $59,000. Minnesota's median household income was about $61,400. For white households, it was about $64,800; for Asians, $68,000; and for Hispanics, $42,000.

Susan Brower, state demographer, said the decline in black household income "stands out especially because the other racial groups are not moving in that direction." The declining income was not caused by higher unemployment in the black community, she said, because there has been no statistically significant change in black unemployment in the state. In fact, black unemployment declined slightly between 2013 and 2014, from 15 percent to 13 percent.

Brower said the income drop could be caused by large movements by particular income groups within the black community, or shifts in occupations. Perhaps people took less-demanding jobs to return to school.

"These are important questions," Brower said. "The numbers do look like something's going on there. What we'll try to do in the coming days is tease out exactly what that is."

The American Community Survey (ACS) is an ongoing survey conducted by the U.S. Census Bureau, with questions on a variety of topics such as income, race, employment, educational attainment, commuting to work and housing. The survey goes out each year to about 3.5 million households nationwide (about 100,000 in Minnesota), with a response rate of about 97 percent. Data estimates generated from these surveys have a degree of uncertainty associated with them, called sampling error. In general, the larger the sample, the smaller the level of sampling error.

For questions pertaining to income, the ACS asks respondents to include all types of wages, Social Security, pensions, welfare or other public assistance, unemployment compensation, Veterans Administration payments, child support/alimony, interest and dividends. Median household income is generated by grouping together these income totals for all individuals in a household. Income for people in group quarters, such as prisons, nursing homes, dormitories or military barracks, are not included in median household income calculations.

In assessing the change in median household income between 2013 and 2014, the Star Tribune used a statistical technique to test for "statistical significance" to determine if the sampling error could be responsible for the variation, and also adjusted the 2013 estimates for inflation. Among all racial/ethnic groups in Minnesota, black median household income was the only one to have a statistically significant change.
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