Earned income, taxes, and government assistance all contribute to the standard of living in American households.
There are many ways to understand what the standard of living looks like in the US: wages and income, government assistance — like Medicaid and unemployment insurance — poverty, household expenses, and more. This page showcases some of these measures to help answer some fundamental questions and directs you to data to understand how our standard of living is changing.
USAFacts categorizes government budget data to allocate spending appropriately, and to arrive at the estimate presented here. Spending on standard of living, most notably with unemployment insurance, spiked during the pandemic.
Government revenue and expenditures are based on data from the Office of Management and Budget, the Census Bureau, and the Bureau of Economic Analysis. Each is published annually, although due to collection times, state and local government data are not as current as federal data. Thus, when combining federal, state, and local revenues and expenditures, the most recent year for a combined number may be delayed.
Focus | Key actors | Responsibilities |
|---|---|---|
Income and taxes | Department of Labor, Congress | Set and enforce federal minimum wage |
Cash assistance | Department of Health and Human Services | Give block grants to fund Temporary Aid for Needy Families (TANF) |
Non-cash assistance and services (including medical benefits) | Department of Health and Human Services | Fund childcare assistance |
Focus |
|---|
Income and taxes |
Cash assistance |
Non-cash assistance and services (including medical benefits) |
Families and individuals that are in the lower groups of earners may fall below the poverty threshold. The poverty threshold for a given household varies by the size of a family and age of its members. The thresholds are uniform in all states. These determinations are made and data is reported by the US Census Bureau.
Gross domestic product (GDP) per capita is a commonly used measure for the standard of living. It’s reported by the Bureau of Economic Analysis (BEA), and it represents the total value of all goods and services produced in the US on a per-person basis if it were divided equally among all citizens.
While earned income and government transfers can give a rough idea of a household’s ability to spend and/or make ends meet, GDP per capita includes personal expenditures directly. However, it also includes government spending on things like infrastructure that contribute to a person’s standard of living. GDP is an everyday economic indicator that is estimated for all US states. The per capita estimate provides a straightforward geographical comparison to view the similarity in the standard of living across the country. For example, areas with higher GDP per capita might be more able to support higher wages and therefore a higher standard of living.