The average U.S. household has a long way to go to recover the wealth it lost to the Great Recession, a report released Thursday by the Federal Reserve Bank of St. Louis concluded.
The typical household has regained less than half its wealth, the analysis found. A separate Federal Reserve report in March calculated that Americans as a whole had regained 91 percent of their losses.
Household wealth plunged $16 trillion from the third quarter of 2007 through the first quarter of 2009. By the final three months of 2012, American households as a group had regained $14.7 trillion.
Yet, once those figures are adjusted for inflation and averaged across the U.S. population, the picture doesn't look so bright: The average household has recovered only 45 percent of its wealth, the St. Louis Fed concluded.
That suggests that consumer spending could remain modest as many Americans try to rebuild their wealth by saving more and paying off debts.
The number of U.S. households grew 3.8 million, to 115 million, from the third quarter of 2007 through the final three months of last year, the report said. As a result, the rebound in wealth has been spread across more people and reduced the average wealth for each household.
In addition, though inflation has averaged just 2 percent over the past five years, it's eroded some of the purchasing power of Americans' regained wealth.
The St. Louis Fed's analysis noted that the rebound in wealth hasn't been equally distributed. As a result, many households are even further behind than the average.
Nearly two-thirds of the increase in household wealth since 2009 is due to rising stock prices, the authors note. Stock indexes reached record highs this month. Those gains disproportionately benefit affluent households: About 80 percent of stocks are held by the wealthiest 10 percent of the population.
For middle- and lower-income households, home values represent the biggest chunk of total wealth. And home prices remain about 30 percent below their peak, even after jumping nearly 11 percent in the past year.
The analysis was written by William Emmons, an economist at the St. Louis Fed, and Ray Boshara, who directs its new Center for Household Financial Stability.
"It's like the economy is this airplane and not all the engines are firing," Emmons said.
Still, wealthier households account for a disproportionate share of consumer spending: About 20 percent of Americans account for about 40 percent of spending.
Consequently, the rise in stock prices should provide some lift to spending, Emmons said.
The average household had a net worth of $539,500 at the end of last year, according to a separate paper the St. Louis Fed released Thursday. That was up from $469,900 in the first quarter of 2009. But it was sharply below the peak of $641,000 in the first quarter of 2007.