Income Equality Nosedives: The Rich vs. Everyone Else 

June 18, 2001

Millions of poor and middle-class working people—the women and men who drive our trucks, teach our kids, serve our food and care for us when we're sick—have helped fuel the economic boom. But the boom times have been bad times for them.

Despite the nation's strong economic growth, the income gap between the rich and the rest of us is growing wider. According to a new report, "Pulling Apart: A State-by-State Analysis of Income Trends," income gaps between high- and low-income families have widened in 46 states since the late 1970s. In the late 1990s, the average income for families in the top 20 percent of income distribution was $137,500—10 times more than the income of the poorest 20 percent of families, whose average income was $13,000.

The gap not only has widened between rich and poor, but between the rich and the middle class. In two-thirds of states, the income disparity between the richest one-fifth of families and the bottom fifth grew between the late 1980s and the late 1990s. Meanwhile, the gap between the wealthiest 20 percent and the middle class (the middle 20 percent) has grown in 45 states.

The report finds that throughout the 1990s, the average real income for the wealthiest one-fifth grew by 15 percent, while the middle class saw less than a 2 percent increase—and the lowest-income families saw no growth at all.

Key findings of the report, released on Jan. 18 by the Economic Policy Institute and the Center on Budget and Policy Priorities in Washington, D.C., include:

· Incomes of the poorest fifth of families declined in 18 states between the late 1970s and the late 1990s, with some of the steepest declines in Wyoming, where average family income declined by $5,600, and Arizona, where families now make $3,900 less than 20 years ago. 

· Income increases for the top 5 percent of families in 11 large states ranged from 35 percent in Texas to 75 percent in Pennsylvania. 

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