October 1, 2018

Worcester median income drops nearly 6%

Photo | Grant Welker
Worcester Common

The median income for a Worcester household fell by 5.6 percent last year to $41,561, according to Census data released this month.

Since a peak of $45,011 in 2013, median income in Worcester fell by 10.5 percent.

"The fall in income in Worcester city is not an indicator of the strength or weakness of the local economy as much as the degree to which economic growth is shared across the region," said Thomas White, an Assumption College economics professor who studies the Greater Worcester economy. "This is related to the increase in income inequality that we have seen at the national level over the past several decades."

That's a sharp contrast from the rest of Massachusetts, where median household income rose by nearly 3 percent last year and by 12 percent in the last three years to $77,385.

More poor people, fewer rich people

More Worcester residents appear to be falling into poverty, despite an unemployment rate in the city of just 4.9 percent in July.

In the most recent year, Worcester saw more households report incomes below $15,000. In 2016, 17.9 percent of households said they were in those lowest income categories. By 2017, that number rose to 21.9 percent.

Statewide, 10.1 percent of Massachusetts households fell into those categories. For a household of one, the federal poverty rate is $12,144 in income annually, according to the state. For a family of four, the threshold is $25,104.

At the same time, the city could be losing its top-earners.

In 2017, Worcester households earning $75,000 or more made up 27.7 percent of the population. Just a year prior, it was 44.8 percent. In 2013, it was 37.9 percent.

Timothy McGourthy, the executive director of the nonprofit Worcester Regional Research Bureau, cautioned that the year-to-year income data was a relatively small sample size and that data over a five-year period, including 2017, showed that income had essentially remained flat. The five-year sample collects from a larger sample of people, he said.

"It's possible that one year's sample is simply markedly different from the prior year's sample," McGourthy said.

The most recent five-year total for Worcester, from 2016, showed median household income as $45,599, which was a 1-percent decrease from the previous five-year total in 2013 of $45,932.

Of the five-year-period totals, McGourthy said he thinks Worcester "is following national trends where incomes have not kept pace with productivity and may finally turn the corner now due to low unemployment rates."

Regional, state growth

Across Worcester County and the Worcester metropolitan area – which the Census defines as Worcester County and Connecticut's Windham County – the numbers were more encouraging.

Worcester County saw incomes rise last year by 1.6 percent to $70,402. Across the metro area, incomes rose by 2.4 percent to $69,412.

In Boston city, median incomes grew last year by 5.4 percent to $66,758.

Each of the other five New England states saw annual income increases in each of the past five years, except for a slight drop in Vermont last year. Nationally, median household income in the past year grew by 1.8 percent to $61,372.

Worcester was not the only one among New England's largest cities to have its median household income fall last year. Springfield and Hartford fell by 6.8 percent and 8.9 percent, respectively.


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