What Is the Median Income in Chicago?

Understanding income levels provides insights into the economic well-being of urban populations. These statistics reflect the financial capacity of residents, influencing local commerce and public services. Analyzing income data helps illustrate the economic landscape and identifies areas of strength or where support may be beneficial. For major metropolitan areas, comprehending these financial metrics is important for understanding daily life and economic opportunities.

Defining Median Income

The term “median income” represents a typical income level. It signifies the middle point in an ordered set of income data, meaning half of households or individuals earn more and half earn less. This statistical measure is preferred over “mean” or “average” income because it is less affected by extreme outliers, such as a few very high earners, which can skew the average significantly upwards. The median offers a more accurate representation of the income status for the majority of a population.

Income can be reported for individuals or households. Individual income refers to a single person’s earnings, including wages, salaries, and self-employment income. Household income combines the total earnings of all individuals residing together. This measure often includes sources beyond wages, such as social security and investment income. Household income accounts for shared expenses and combined financial power within a living arrangement.

Chicago’s Current Median Income

Chicago’s median household income provides a measure of the city’s economic standing. As of 2023, the median household income for Chicago was $75,134. This figure is reported in 2023 inflation-adjusted dollars, ensuring comparable purchasing power across years. This income level represents approximately 95.67% of the U.S. median household income ($78,538), indicating Chicago’s median is slightly below the national average.

This data is primarily sourced from the U.S. Census Bureau’s American Community Survey (ACS). The ACS is an extensive, ongoing annual survey that collects detailed demographic, social, economic, and housing information across the United States. It gathers data continuously throughout the year from a sample of the population, providing timely insights into communities, unlike the decennial census which provides a snapshot every ten years.

The Census Bureau compiles and updates these figures annually, often releasing both one-year and five-year estimates. One-year estimates provide current data for larger populations, while five-year estimates offer more robust and reliable data for smaller geographic areas or demographic groups by pooling data over a longer period. The median household income for Chicago has shown growth, increasing by 2.55% from $73,267 in 2020 to $75,134 in 2023, when adjusted for inflation. This upward trend offers a snapshot of the city’s recent economic trajectory, providing a baseline for understanding the financial capacity of typical households within Chicago.

Factors Shaping Chicago’s Median Income

Chicago’s median income is influenced by its economic sectors and demographic patterns. The city boasts a diversified economy, contributing to its income levels. Key industries include finance and fintech, technology, manufacturing, healthcare, and transportation and logistics. These sectors offer a range of employment opportunities, from professional roles to skilled positions.

The employment landscape in Chicago, with its diverse industries, directly impacts median income. While the city has experienced some corporate relocations, it remains a major economic hub. The availability and type of jobs, alongside employment rates, shape the earning potential for residents.

The cost of living in Chicago also contextualizes income levels. Although Chicago’s cost of living is slightly higher than the national average, it is often considered more affordable than other large U.S. cities. Income earned needs to support these expenses.

Demographic factors, such as age distribution and educational attainment, shape median income. A younger, educated workforce entering higher-paying fields can elevate income levels. Chicago benefits from a strong talent pipeline, supporting its knowledge-based industries. These factors create the economic environment defining Chicago’s median income.

Income Disparities Within Chicago

While a city-wide median income provides a general overview, significant variations exist within Chicago. Income levels differ substantially across neighborhoods, creating distinct economic realities. Some areas, particularly on the North and Near West Sides, have median incomes well above the city average, reflecting concentrations of higher-income households. Conversely, many neighborhoods on the South and West Sides experience lower median incomes and higher poverty rates.

Demographic characteristics also contribute to income disparities within Chicago. Median household income varies by household type, such as family versus non-family households, with family households generally showing higher median incomes. Significant income differences are observed across racial and ethnic groups. White households in Chicago report a higher median household income compared to Black or African American households, illustrating a notable wealth and income gap.

Educational attainment levels are another factor influencing income variations, with higher education generally correlating with increased earning potential, though disparities can persist even with similar educational backgrounds. The distribution of income within Chicago underscores that the single city-wide median figure represents a wide spectrum of financial situations, influenced by historical patterns and ongoing economic forces. Understanding these internal variations is important for a complete picture of economic well-being and for identifying areas where targeted support may be needed.