While white households' average wealth increased by 2.4% to about $141900 in 2013, that of black and hispanic households are $11000 and $13700 respectively. The networth median of white households is more than 10 times of other racial groups, rising to a new record level.
There are several reasons for the growing gap. First, minority households may have not been able to sock away as much or used more of their savings to cover expenses. Also, the financial markets have recovered a lot, and whites are more likely to own stocks. Real estate makes a majority of black and hispanic households' networth, nut has declined in the last few years.
http://money.cnn.com/2014/12/12/news/economy/wealth-by-race-pew/index.html?iid=HP_River
These numbers are mind boggling, and I truly never knew how much of an income gap there was between different ethnic groups. I always knew one existed, but never knew it was as large as 10x, that is huge! I can definitely see how the great recession exacerbated this gap though, which is truly unfortunate. As oil prices continue to drop I wouldn't be surprised if closed slightly in the near future.
ReplyDeleteThose numbers are very alarming indeed. Hopefully the recovering economy will help some of these people increase their incomes. Since these people have so little money they will likely consume everything they make, further increasing consumption in the economy.
ReplyDeleteAt first, I assumed that this statistic reported by Pew research showed the average (mean) wealth distributions in the United States. This would have been an alarming disparity, but could have been explained at least in part by the fact that most of the billionaires/ultra high net worth individuals in the United States are white (as per Forbes list of the wealthiest Americans). The fact that these figures show the median household wealth is truly shocking, and somewhat disturbing.
ReplyDeleteIs it specifically white people or is it sections from certain socioeconomic backgrounds? I know there is often times a disparity between the economic status of certain racial groups, and when studied the results sometimes factor out certain classes access to financial information. In addition there is evidence that banks give worse loans to people of color, even when white people have the same socioeconomic status.
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