Family Income Composition

Abstract

Family income has increased overall in the United States since the 1950s, but increased prosperity has not been distributed evenly, with family economic well‐being increasing more for some families than others. The end result has been increased family income inequality. Married couple families with a wife in the labor force have seen the largest gains over the decades. In general, families experienced increased prosperity over the 1950s and 1960s, a time when earnings increased for men and women. Starting in the early 1970s, however, the gap between families with a wife in the labor force and other families expanded markedly, as men's wage inequality grew and women's earnings continued to rise. This resulted in a flat trend line for families dependent only on men's earnings. Meanwhile, female‐led families have seen only modest increases in family income. This uneven growth in family income has its roots in demographic changes in the family, the focus of this essay. Markedly, the rise in women's employment and earnings, the rise in men's wage inequality, and shifts in family structure and increased marital homogamy on earnings all contributed to the shifts in family income composition.

Women As Economic Providers: Dual-Earner Families Thrive As Women's Earings Rise

“…Women's increased commitment to the labor force exhibited by their longer job tenures and work hours coupled with their higher education levels and workforce experience has worked to increase women's earnings. 17 This, in turn, has been a major driver in the rise in family income among married couples with an employed wife. More recently, however, wage growth has expanded more rapidly for educated and higher-earning women, somewhat similar to the pattern for men, resulting in a rise in wage inequality among women.…”