AFRICANGLOBE – The economy is recovering, but not the bottom line for Black Americans, according to new figures from the Pew Research Center.
The median wealth of Black households dropped an astonishing 34 percent from 2010 to 2013, according to Pew’s analysis of Federal Reserve data. That of white households grew slightly over the same period.
In dollars, that meant the median white household was worth $141,900, while the median Black household was worth just $11,000. Wealth was defined here as the difference between the value of the household’s assets — like a house and stocks — and its liabilities.
Another way to look at it: The median wealth of white households was 13 times higher than the median wealth of Black households last year. That’s the widest gap measured since 1989, when white people’s fortunes were 17 times bigger. Between then and now, the gap was at its narrowest in 1998 and 2001, when white households were six times as wealthy as Black households.
For many middle-class Americans, wealth is tied to the value of their homes. When the housing market crashed in 2007, the value of Americans’ assets took a beating across racial groups. Yet in the recovery, Blacks have not bounced back as well as whites.
Black homeownership rates in the U.S. have historically been lower than white homeownership rates for a variety of reasons, but primarily due to a long history of racist housing policies that legal reforms have not entirely erased. During the housing boom of the last decade, Blacks were more likely to get stuck with high-cost subprime mortgage loans than whites. In the crash, Blacks were more likely to lose their homes than whites.
The gap between white and Hispanic households, meanwhile, was at a 12-year high in 2013. According to Pew’s report, white households’ median net worth was about 10 times that of Hispanic households: $141,900 vs. $13,700. And Hispanics’ median wealth had fallen 14 percent from 2010 to 2013.
Over the same period, median income for Black, Hispanic and other minority households plunged 9 percent. Median income for white households fell just 1 percent.
By: Alexander C. Kaufman