Income Inequality Grew After the Great Recession

June 12, 2012 at 5:39 pm 2 comments

The Federal Reserve Bank released the results of the 2010 Survey of Consumer Finances yesterday, which looks at the period between 2007 and 2010. The big, and not surprising, news is that income inequality continued to grow despite the Great Recession. Here are a few of the findings:

  • Median family income decreased 7.7 percent
  • Median family income decreased more for non-white or Hispanic families, down 11.3 percent, compared to a 2.6 percent decline for white families
  • Median net worth (income minus liabilities) decreased 38.8 percent, from $126,000 in 2007 to $77,000 in 2010
  • The percent of families that save also decreased, from 56.4 percent of families to 52 percent of families

The most disheartening finding is that net worth for the top 10 percent of income earners actually increased during this time, while net worth for all other income groups dropped.  See the highlighted portion of the chart below. The gap between the highest and lowest incomes grew even wider. Middle income groups saw increases between 2001 and 2007, with a precipitous drop in 2010.For the bottom 20 percent, net worth has been on the decline since 2001.

These figures just provide further confirmation of what we already knew. While most people, particularly those with lower incomes and people of color, continue to struggle and suffer from the effects of the recession (and some have been struggling long before the recession) those at the very top remain protected from any real-life consequences and continue increasing their wealth. There’s only one word to describe this: injustice.

Entry filed under: Economic Development. Tags: .

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