| WASHINGTON, June 18
WASHINGTON, June 18 U.S. households saw their
wealth decline by more than a third between 2005 and 2010 as
home values and share prices plummeted, leaving many with weak
safety nets to weather a harsh economic environment.
The median household net worth dived 35 percent to $66,740
in the five year period, the Census Bureau said in a report on
Monday. However, making comparisons with prior periods is
difficult because of inflation adjustment issues.
"The overall decline in net worth reflects drops in housing
values and stock market indices," said Census Bureau economist
The median household net worth, which is the value of assets
minus debt, was $102,844 in 2005, in 2010 constant dollars.
However, the median household net work excluding home equity
increased 8 percent to $15,000 between 2009 and 2010.
Federal Reserve data last week showed Americans suffered a
record decline in wealth between 2007 and 2010, with median
family net worth dropping 38 percent to $77,300.
That decline was blamed on house prices, which have dropped
sharply from their 2005 peak.
Net worth provides a backstop for households during periods
of economic uncertainty and family crisis. Declining wealth
means that households have had little resources to draw on
during the recession and the economy's lackluster recovery.
"If someone loses their job and they have high enough
accumulated wealth they can use that to bridge the gap between
losing their job and finding work again," Gottschalck told
The recovery from the 2007-09 recession has been weak by
historic standards, with the pace of economic growth
insufficient to bring down unemployment.
The unemployment rate is currently at 8.2 percent and has
been stuck above 8 percent since February 2009.
The Census Bureau's findings from the Survey of Income and
Program Participation showed the decline in wealth between 2005
and 2010 was across all age groups.
However, the losses in absolute terms were deeper for older
households than for younger ones. Householders 65 and older saw
their median net worth falling to $170,128 from $195,890. The
wealth of those under 35 decreased to $5,402 from $8,528.
Households between 35 to 44 years saw a 59 percent drop in
median net worth to $33,200, the survey found.
All education groups suffered declines in wealth. The median
income for households with a high school diploma fell 39 percent
and dropped 32 percent for those with a bachelor's degree.
However, net worth remains high among households with more
education. In 2010, households with a graduate or professional
degree had a median net worth of $245,763, while the median net
worth of those with a high school diploma only was $42,223, the
Households with a bachelor's degree had a median net worth
of $142,518 during that period.