WASHINGTON -- A survey of U.S. family finances released by the Federal Reserve on Monday documents in painful detail just how deeply the recession and its aftermath has been felt in family budgets across the United States.
The Survey of Consumer Finances, conducted every three years and covering a span from 2007 to 2010, documents steep declines in family income that correspond to what most U.S. residents already know about their declining net worth.
It also shows how the South and West have felt more pain than the rest of the country because of the severity of the housing sector's downturn there and provides evidence that the self-employed and business owners have taken it on the chin in recent years.
The survey findings provide fodder for the re-election efforts of President Barack Obama and the campaign of presumptive GOP presidential nominee Mitt Romney. Obama can use the data to show what a terrible economy he inherited, while Romney can use the data to show how bad things remain.
The Fed survey found that the median value of family income, when adjusted for inflation and before taxes, fell by 7.7 percent from $49,600 in 2007 to $45,800 in 2010. The median is the midpoint of all family income, and while it fell in all four corners of the nation, it fell furthest in the South and West.
The Fed found that median net worth fell 38.9 percent from $126,400 in 2007 to $77,300 in 2010. That essentially took net worth back to levels recorded in 1992 and reflects the steep erosion of housing wealth. Middle-class U.S. residents have a greater proportion of net worth tied up in their home than do the rich.
The Northern San Joaquin Valley has experienced some of the nation's most drastic home value declines since the recession hit.
Wages down, poverty up
In January 2007, Stanislaus County's median home sales price was $355,000. By December 2010, sales prices had plummeted to $135,000, which is about what they are today, according to DataQuick. That's a 62 percent plunge.
Stanislaus' family incomes also have fallen. In 2008, for example, the county's median family income was $58,962, but it dropped to $53,261 in 2010. That was a 9.7 percent income dip before inflation, according to the Census Bureau's American Community Survey.
While home values and wages have shrunk, the number of local residents living in poverty and relying on food stamps has soared.
In 2007, Stanislaus County's poverty rate was 13.5 percent, but by 2010 it had jumped to 19.9 percent, American Community Survey statistics show.
"We have so many people coming in who say, 'I have never asked for help before, but I have to feed my children,' " said Christine Applegate, director of Stanislaus' Community Services Agency.
Applegate said the number of Stanislaus residents receiving food stamps now called the CalFresh program has risen nearly 90 percent since the recession began.
The Federal Reserve's just-released study goes through 2010, but Stanislaus' statistics show the demand for food stamps has continued to increase. In March 2010, there were 55,848 residents getting help to buy food. By this March, that had increased to 67,110 a jump of more than 20 percent.
"These are families really hit by the recession who lost their jobs and can't find work," said Applegate, noting the county's high unemployment. Stanislaus' unemployment rate was 16.4 percent in April.
The decline of incomes follows a period from 2000 to 2007 where they stayed flat from the end of the dot.com recession throughout recovery and until the December 2007 start of the Great Recession. It marked the first time since the end of World War II that workers made almost no progress on wages throughout an entire business cycle, said Larry Mishel, president of the liberal think tank Economic Policy Institute.
"It's why I think about it as a lost decade for families," he said.
The average income for U.S. families, called the mean, fell even more dramatically, by 11.1 percent in the latest Fed survey period.
"The decline in mean income was even more widespread with virtually all demographic groups experiencing a decline between 2007 and 2010; the decline was most pronounced in the top 10 percent of the income distribution and for higher education and wealth groups," the Fed's survey says.
Good news: Debt eases
Falling incomes also help explain why consumer confidence remains shaky, three years after the recession ended in June 2009.
"Even before the Great Recession, we were watching consumer income for most families either grow ever more slowly or outright decline," said Ken Goldstein, an economist with the New York-based Conference Board, which publishes a survey of consumer confidence. "Here we are in 2012, not only are we not closing that income gap, if you like, we're probably a good two or three years from beginning to close that gap."
In a bit of good news, the Fed survey found that the debt burden on families eased somewhat from 2007 to 2010, aided by uncommonly low lending rates. The number of families with debt exceeding 40 percent of their income also fell slightly, although the number of families 60 days late on loans ticked up from 7.1 percent in 2007 to 10.8 percent in 2010.
Bee staff writer J.N. Sbranti contributed to this report.