How much does the average American make a year? This is an important question that we will answer for you in this post. The last year has been a difficult one for all of us with the Covid-19 pandemic. Has this affected the average wage in the United States?
A lot of people want to know the answer to this question so that they can compare what they are earning to what their fellow Americans earn on average. As you can imagine, there are a lot of different factors to take into account when looking at salaries. The age of the person and where they are working will have a significant impact on this.
How much does the average American make a year?
So, first we will answer the question. The BLS (Bureau of Labor Statistics) states that the average salary for people working in the US for the final quarter of 2020 was $51,168 a year which equates to $984 a week based on a 52 week working year. This is a rise of 5.7% on the last quarter of 2019.
There is a difference between the average salary and the median salary for US citizens. In 2019, the median salary for Americans was just $34,248 a year. The reason that average wage numbers are higher is because those that earn higher incomes tend to skew the data upwards.
Despite efforts to level up the pay of men and women a gap still exists. For the same time period (fourth quarter 2020) the median wage for a man was $55,744 while the median age for women was $46,488. This means that the average salary for a woman is more than 26% lower than for a man. Lots of improvement still to be made here.
Are you earning a good Salary?
When your salary is higher than $51,168 then in theory you are earning a higher-than-average salary. But there are other things to take into account here. If you live in a big city then earning just over the average may not be considered enough. Larger cities have a higher cost of living and therefore the salaries are usually higher than average anyway.
What type of job do you have? If it is considered management or professional then earning slightly more than the average salary for the country is not very good. People with higher educations tend to earn more than those that don’t so you need to consider this as well.
How many Americans earn more than $100,000 a year?
It may surprise you to know that according to Statistica, over 34% of United States citizens earn more than $100,000 a year. There are more interesting numbers from Statistica here:
- Americans earning over $100,000 a year 34%
- Americans earning $100,000 to $149,999 a year 15.5%
- Americans earning $150,000 to $199,999 a year 8.3%
- Americans earning more than $200,000 a year 10.3%
In complete contrast to this, the Census Bureau stated there are some 34 million US citizens that are living below the poverty line. This was the figure in 2019 and it has been falling each year up to this point which is good.
Average Wage for Americans by Age Group
As we said earlier, the average salaries for Americans vary by age. Younger age groups traditionally earn less than those in older age groups. The Bureau of Labor publishes these figures each quarter and they show them in weekly wage terms. We have multiplied these up to a yearly amount for the sake of consistency:
- Americans in the 20 to 24 age group averaged $2,516 a month or $30,192 a year
- Americans in the 25 to 34 age group averaged $3,672 a month or $44,064 a year
- Americans in the 35 to 44 age group averaged $4,516 a month or $54,192 a year
- Americans in the 45 to 54 age group averaged $4,616 a month or $55,392 a year
- Americans in the 55 to 64 age group averaged $4,432 a month or $53,184 a year
- Americans in the 65+ age group averaged $4,024 a month or $48,288 a year
Are there any surprises here for you? It is interesting that people in the 55 to 64 age group earn less than the 45 to 54 age group. Some people retire at around the age 50 which will have an impact on these numbers.
So now you know the answer to the question “how much does the average American make a year?” We recommend that you use this information to improve your situation. If you are not earning the average wage at the moment then take positive steps towards this.
If you are earning around the average wage then think about how you can move into the higher earning bracket. What do you need to do to achieve this? Be prepared to step out of your comfort zone and do whatever it takes to earn more.