My introductory sociology classes have been looking at statistics. This made me think about how we represent income in the U.S. News stories often just report “average” income without defining what that means. The Census released a new report on Income, Poverty, and Health Insurance on September 13. Their press release states that median income is $49,445 (The full report can be found here). This is a much better figure than mean (what we think of as average income) because that calculation is highly sensitive to outliers. The median tells us that half of the people have incomes above $49,445 and half have incomes below that.

However, even the median can be misleading. This is median household income. If we break that down into family households (people who are related who live together) and non-family households (people who are not related who live together) the numbers are very different. Non-family households have a median income of $29,730. Family households have a median income of $61,544. The difference is not surprising once you realize that people who live with unrelated people are likely doing so because they cannot afford not to.

What this all shows is it is essential to know how a statistic is defined. The name that they used, median household income, is correct, but it hides quite a lot of important information.