Wealth Gaps Rise to Record Highs Among Whites, Blacks and Hispanics
The economic turmoil of 2007-2009 adversely impacted household earnings across America, but a 2011 research study details the extent to which significant declines in household wealth were concentrated in lower-income and minority populations and those whose wealth was primarily derived from their homes.
The 2011 report from the Pew Research Center, “Wealth Gaps Rise to Record Highs Between Whites, Blacks and Hispanics” (PDF), compared data from the Survey of Income Program and Participation (SIPP) in 2005 and 2009. The SIPP collected significant data on low-income and minority households.
The key findings include:
- The ratio between the median wealth (assets minus debts) of white households versus that of black and Hispanic households is the largest since the government started collecting such data in 1984, and approximately twice what it had been before the Great Recession of 2007-2009.
- From 2005 to 2009, inflation-adjusted median household wealth dropped by 66% among Hispanic households, 54% among Asian households, 53% among black households, and 16% among white households.
- In 2009, typical wealth (again, a family’s assets minus its debts) had dropped to $5,677 for black households, $6,325 for Hispanic households, and $113,149 for white households.
- Hispanic homeowners suffered the most from plummeting home prices; their median levels of home equity declined nearly 50%. A high percentage of Hispanic homeowners also lived in California, Florida, Nevada and Arizona, where the housing market was decimated by the bursting of the real estate bubble in the mid-2000s.
- Greater income disparities also emerged within racial and ethnic groups. While the wealth of the top 10% of households declined during the study period, the top 10% of wealthiest Hispanics increased their percentage of the aggregate wealth of all U.S. Hispanics from 56% in 2005 to 72% in 2009, and the share of in-group wealth held by the 10% of wealthiest whites rose from 46% in 2005 to 51% in 2009.
The study’s findings also highlight the extent to which home ownership may not provide long-term financial stability.
Tags: financial crisis, poverty, race, Hispanic, Latino, inequality, ethnicity and community
Note to instructor: The suggested assignments are designed for flexibility. They can be used in whole or part and can be adapted to a particular task -- for example, the newswriting assignments could be applied to the writing of the headline, the lead, the nut graph or the full story. Material from the assignments could also be combined with other material, for example, in the writing of a background, feature or local-angle story.
Read the Pew Study "Wealth Gaps Rise to Record Highs Between Whites, Blacks, Hispanics" (PDF).
- Summarize the study in fewer than 40 words.
- Express the study's key term(s) in language a lay audience can understand.
- Evaluate the study's limitations. (For example: Do the results conflict with those of other reliable studies? Are there weaknesses in the study's data or research design?)
Read the issue-related Asian Tribune article "Minorities in U.S. -- Blacks and Hispanics -- further fall toward impoverishment."
- If you were to rewrite the article based on knowledge of the study, what key changes would you make?
- Write a lead (or headline or nut graph) based on the study.
- Spend 60 minutes exploring the issue by accessing sources of information other than the study. Write a lead (or headline or nut graph) based on the study but informed by the new information. Does the new information significantly change what one would write based on the study alone.
- Interview two sources with a stake in or knowledge of the issue. Be prepared to provide them with a short summary of the study in order to get their response to it. Write a 400-word article about the study incorporating material from the interviews.
- Spend additional time exploring the issue and then write a 1,200-word background article, focusing on major aspects of the issue.