Research has demonstrated that income inequality in the United States has grown significantly over the past two generations. While this widening divide between the haves, have-nots and have-somethings is reflected in more income stratification in the composition of residential neighborhoods, a 2012 study from the Pew Research Center suggests that this segregation pattern varies significantly according to factors such as region, metropolitan area and population migration.

The study, from the Center’s Social and Demographic Trends division, “The Rise of Residential Segregation by Income,” analyzes data from the U.S. Census Bureau’s 2010 American Community Survey to examine the income composition of various census tracts in 1980, 1990, 2000 and 2010. The study, authored by Richard Fry and Paul Taylor, developed a Residential Income Segregation Index (RISI) to measure the level of income segregation in the 30 largest metropolitan areas in the United States.

The study’s findings include:

• Residential income segregation increased significantly over the past 30 years. The number of lower-income households who reside in census tracts where the majority of households are lower income rose to 28% in 2010, up from 23% in 1980. As of 1980, “12% of households were in majority lower-income tracts and 2% were in majority upper-income tracts.” In 2010, 15% of households were in majority lower-income tracts, and 6% of households were in upper-income tracts.
• In 2010, the average upper-income household resided in a census tract composed of 32% upper income household, compared to 25% upper-income households in 1980. However, “rather than distancing themselves from the poor, upper-income households have the same degree of exposure to lower-income households as in 1980. In 2010, the typical census tract of upper-income households was composed of 22% lower-income households, unchanged from the 1980 level.”
• The top three metropolitan areas in the U.S. with the highest levels of income segregation, according to RISI scores, were Houston, Dallas and New York. The metropolitan areas in the U.S. with the lowest levels of income segregation were Boston, Chicago, and Atlanta.
• There has been a significant rise in residential segregation in metropolitan areas with high population growth, such as Houston and Dallas. Immigration is the likely driver of this trend.
• With respect to regions, the Southwest has the highest level of residential income segregation in the United States, followed by the Northeast. The Southeast has the least residential income segregation of any region in the United States.

“These increases are related to the long-term rise in income inequality,” the study notes. Rising inequality has “led to a shrinkage in the share of neighborhoods across the United States that are predominantly middle class or mixed income (to 76% in 2010, down from 85% in 1980) and a rise in the shares that are majority lower income (18% in 2010, up from 12% in 1980) and majority upper income (6% in 2010, up from 3% in 1980).” These patterns are also the result of immigration creating large groups of low-income communities, as well as a rapidly shrinking American middle class.

Other recent research within this broad topic provides additional perspectives and data. See studies on: the decline in racial segregation over a longer time period; the movement of Hispanics to new areas; and the latest assessments of poverty dynamics in U.S. urban areas.

Tags: poverty, gentrification