Households Earning More Than $100,000

The percentage of households earning over $100,000 annually has increased significantly in recent decades, up from 15.2% in 1980 to an estimated 30.7% in 2020. At the same time, the business cycle and wealth distribution fluctuations have caused notable short-term volatility in this metric. For instance, strong economic growth between 2005 and 2007 caused a significant rise in high-earning households, particularly because this economic growth was skewed towards top earners. However, the global financial crisis in 2008 and the subsequent recession caused the number of high-earning households to plunge. Moreover, the collapse of the banking industry caused many highly paid US citizens to lose their jobs. In addition, lesser-paying job losses in all industries caused many formerly dual-income households to slip below the $100,000 threshold. The resulting rise in unemployment caused this driver to fall every year between 2008 and 2011.

More recently, real economic growth and expanding demand for highly skilled workers has caused this trend to reverse. Over the five years to 2022, the percentage of households earning more than $100,000 annually has increased an estimated 2.97 percentage points, bolstered by the proliferation of high-paying jobs in technology and financial industries, continuous strong demand for higher education and technology-driven growth in worker productivity. Nonetheless, the COVID-19 (coronavirus) pandemic resulted in a 1.0 percentage point decline in 2020 due to business closures, a weakened labor market and other negative impacts on businesses of all kinds. The spread of the virus caused millions of US citizens to file for unemployment, including high earning individuals from companies that did not survive the decline. Additionally, several companies required employees to take a pay cut, placing some individuals under the $100,000 threshold. Despite the decline in 2020, the vaccine rollout and easing of pandemic-related restrictions benefited the economy, resulting in a recovering unemployment rate and an increase in households earning more than $100,000 in 2021. Mounting inflation has resulted in wages rising. This is estimated to increase the number of individuals over the $100,000 threshold to reach 37.7% in 2024.