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Friday, November 3, 2017

Wealth Inequality and Race

Rakesh Kochhar and Anthony Cilluffo at Pew:
Lower-income white families experienced greater losses in wealth during the recession than lower-income black and Hispanic families did.Prior to the recession in 2007, lower-income white families had 10 times as much median wealth as lower-income black families – $42,700 versus $4,300 (figures in 2016 dollars). Lower-income Hispanic families had a median net worth of $8,400, lagging white families by a ratio of five-to-one.
These large wealth gaps were trimmed roughly in half by the Great Recession, which cut the median wealth of lower-income white households to $21,900 in 2010, a loss of 49%. Losses for lower-income black and Hispanic households were much smaller, 3% and 5%, respectively. The larger losses for lower-income white families may have arisen from their greater exposure to the housing market crash. In 2007, 56% of lower-income whites were homeowners, compared with 32% each of lower-income blacks and Hispanics. The homeownership rate among lower-income whites has trended downward since then, falling to 49% by 2016, but the rate for blacks and Hispanics is largely unchanged.