Movin’ on up

Eighty-four percent of Americans — and 93 percent of those in the bottom quintile — earn more than their parents in inflation-adjusted dollars, concludes a new Pew report, Pursuing the American Dream: Economic Mobility Across Generations.

Yet 43 percent of people who start in the bottom quintile end up there, notes Education Gadfly. Nearly three-quarters remain in the bottom 40 percent.

A black-white mobility achievement gap is present as well: Half of blacks who were raised on the wealth ladder’s bottom rung stay there as adults, compared to a third of whites. The “stickiness at the ends” phenomenon affects America’s wealthiest as well: Sixty-six percent of those with parents in the top quintile stayed among the elite (earning at least $164,000 a year). As Pew explains (and Charles Murray concurs), this “stickiness” is partially caused by marriage patterns. High earners are forming unions with others in their quintile, further bumping their family wealth and income.

For those raised at the bottom of the family income ladder, college provides a way up: Only 10 percent of college graduates — and 47 percent of those without a degree — end up at the bottom rung.

About Joanne

Comments

  1. Crimson Wife says:

    My DH and I have a higher inflation-adjusted income than either set of parents, but our purchasing power is less than both. The costs of housing, health care, and higher education in particular have skyrocketed in the past few decades so even though on paper we’re better off, in reality we’re worse off :-(

  2. Richard Aubrey says:

    Crimson. Inflation-adjusted is supposed to take care of those increases so that your purchasing power can be accurately compared.
    However, the index figure for comparison is the market basket of goods and services as devised by the government. If, for example, housing is included in the calcs, inflation would be down, which wouldn’t help with groceries nor the mortgage. If your home is paid for, the housing component is not important, except that if the inflation number is down, so is COLA increase.
    Been said that the average poor person has a material lifestyle roughly equivalent to the mid-middle class in the Fifties.
    Ex. What used to be a common home square footage is now rarely found except in Sec 8 housing, considered to be inadequate. So “cost” is not only objective, it’s subjective in terms of what is necessary as opposed to desireable.

  3. “High earners are forming unions with others in their quintile, further bumping their family wealth and income.”

    Uh oh. Sounds like one day there will be an Orwellian requirement that a wealthy person can only marry a middle class / impoverished person, and vice versa. Gotta even out those odds!