Income Gap Between Black, White Families Grows

AP, November 13, 2007

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Incomes have increased among both black and white families in the past three decades—mainly because more women are in the work force. But the increase was greater among whites, according to the study being released Tuesday.

One reason for the growing disparity: Incomes among black men have actually declined in the past three decades, when adjusted for inflation. They were offset only by gains among black women.

Incomes among white men, meanwhile, were relatively stagnant, while those of white women increased more than fivefold.

“Overall, incomes are going up. But not all children are benefiting equally from the American dream,” said Julia Isaacs, a fellow at the Brookings Institution, a Washington think tank.

Isaacs wrote a series of three reports that looked at the incomes of parents in the late 1960s and early 1970s, and of their grown children 30 years later. Isaacs compared the incomes of parents who were in their 30s with the incomes of their children, once they reached the same age group.

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The reports found that about two-thirds of the children surveyed grew up to have higher family incomes than their parents had 30 years earlier.

Grown black children were just as likely as whites to have higher incomes than their parents. However, incomes among whites increased more than those of their black counterparts.

The result: In 2004, a typical black family had an income that was only 58 percent of a typical white family’s. In 1974, median black incomes were 63 percent those of whites.

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Perhaps most disturbing, middle-income black families do not appear to be passing on higher incomes to their children in the same way that white families have, Isaacs said.

She found that only one in three black children from middle-income families grew up to have higher incomes than their parents.

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Among whites, about two-thirds of the children from middle-income families grew up to have higher incomes than their parents, she said.

On a positive note, black children from poor families were much more likely to grow up to have higher incomes than their parents, Isaacs said.

Isaacs compiled the reports for the Economic Mobility Project, a collaboration of senior economists and researchers from four Washington think tanks that span the ideological spectrum. The project is funded and managed by the Pew Charitable Trusts.

Isaacs used survey data from the Panel Study of Income Dynamics, which is conducted at the University of Michigan.

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