Inequality has reached levels not seen since the 1920s, research
shows. The income gap in major US cities is widening because pay has plummeted
for the poorest households since the Great Recession began in late 2007,
according to a new study.
Even as the economic recovery gained momentum in 2014,
incomes for the bottom 20 percent declined in New York City, New Orleans,
Cincinnati, Washington, DC, and St. Louis, according to an analysis of Census
data released by the Brookings Institution, a think tank.
“It’s really about the poor losing ground rather than these
upper-class households pulling away,” said Alan Berube, a senior fellow at
Brookings and deputy director of its metropolitan policy program. The analysis
suggests that relatively strong job growth and small pay raises have failed to
pull millions of Americans out of poverty.
Brookings found that the income gap was highest in Boston,
where the wealthiest 5 percent made 17.8 times what the bottom 20 percent did.
Even as the economy has rebounded from the recession, which
technically ended in mid-2009, nearly all the income gains have gone to the
top. In the first three years of the recovery, 91 percent of income gains went
to the wealthiest 1 percent of households, a group with incomes above roughly
$400,000, economics professor Emmanuel Saez of Berkeley University has found
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