Middle class gets richer, but the wealthy do even better, making inequality worse, Fed says
Most American families grew richer between 2013 and 2016, but the wealthiest households pulled even further ahead, worsening the nation’s massive disparities in wealth and income.
The median net worth of American families rose to $97,300, up 16% from 2013, according to a Federal Reserve survey released Wednesday. The median is the point where half of families fall below and half above.
The figures echo recent data released this month from the Census Bureau that also showed middle-class incomes rising. For roughly the first five years of the economic recovery that began in 2009, higher-earning households reaped most of the gain. But in 2015 and 2016, the low and falling unemployment rate has helped push up pay at all income levels. Rising home prices have also restored some wealth to middle-income families.
But the Fed report starkly illustrates the depth of the nation’s wealth and income gaps. The disparities exist along lines of income, race and ethnicity, and between city and rural dwellers.
Even as median income rose, average income rose more quickly, by 14% to $102,700. Those differences between the median and average mostly reflect stronger gains at the top of the income scale.
And even as black and Latino families reported large wealth gains, wealth gaps along racial lines barely narrowed.
Median wealth for an African American family was $17,600 last year, up 29% from 2013. That’s a much bigger gain than the 17% gain for whites.
Yet median wealth for white families was $171,000, still 10 times that of blacks and roughly eight times that of Latinos.
Median wealth for the richest 10% of U.S. families jumped 40% in the past three years, to $1.63 million. That’s nearly 17 times as wealthy as the median for all U.S. families.
That bigger gain by the wealthiest families left them with a greater share. The 1% richest families now hold nearly 39% of U.S. wealth, up from 36.3% in 2013, the Fed said.
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