poverty, inequality, median income, median net worth

The Pew Hispanic Center released results of a study that indicates that over the period 1999 - 2002, white people's economic situations became significantly better relative to minority households. Median net worth of white households over the 1999-2002 period rose 2.6% to $88,651. Over the same period Hispanic households' median net worth fell 24% to $7,932; African-American households' median net worth fell 32% to $5,988. While minority wealth is 1/10 that of white households, median income is much higher, equal to about 2/3 of white households. In 2002, less than half of Hispanic and African-American households were homeowners, compared to 74% of whites.

Much of the wealth differential arises from minorities' inability to gain access to financial services and home ownership. As a result, minorities tend to have much less insulation against recessionary periods than white households do. Given the significant increases in health-care costs, home prices, and reductions in real wages at the bottom of the wage scale, low-wage workers--who are predominantly minorities--have difficulty building up the base (home ownership, financial cushions for emergencies, retirements plans, etc) to accumulate wealth.

Two sectors that have experienced a significant increase in wages--construction and service sectors--are seeing more Hispanic new employees. Whether this translates into greater material wealth remains to be seen.

(Updated December, 2004)