Posts Tagged ‘whites’

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March 8, 2017

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According to a new study by the St. Louis Federal Reserve Bank (pdf), higher education does not protect the wealth of all racial and ethnic groups equally.

Compared to their less-educated counterparts, typical white and Asian families with four-year college degrees withstood the recent recession much better and have accumulated much more wealth over the longer term. Hispanic and black families headed by someone with a four-year college degree, on the other hand, typically fared significantly worse than Hispanic and black families without college degrees.

In other words, while higher education leads to higher income and wealth compared to non-college graduates for all ethnic and racial groups, changes in wealth and income during the Second Great Depression are much more uneven.

Thus, in terms of wealth, white and Asian college-headed families generally fared much better than their less-educated counterparts, while the typical Hispanic and black college-headed family lost much more wealth than its less-educated counterpart. When it comes to changes in real income, the experience of whites and Hispanics runs counter to their respective wealth changes; for blacks, however, the results are similar: black college-headed families lost much more wealth and income than non-college families.

The authors of the study thus conclude,

Higher education alone cannot level the playing field. Evidence presented here suggests that college degrees alone do not provide short-term wealth protection, nor do they guarantee long-term wealth accumulation.

net worth

According to a new study by the Federal Reserve Bank of St. Louis, little has changed over the past 25 years in terms of the glaring wealth gap in the United States between blacks and Hispanics on one hand, and whites on the other.

The median wealth levels of Hispanic and black families are about 90 percent lower today than the median wealth levels for whites. Back in 1989, the median wealth of a white family was $130,102. In 2013, it was $134,008, after adjusting for inflation. For a Hispanic family, they were $9,229 and $13,900, while for a black family, they were $7,736 and $11,184.

The one group that has experienced an improvement, both absolutely and relative to whites, are Asian families. Their real median wealth grew between 1989 and 2013 from $64,165 to $91,440. And, because of that growth, and the precipitous decline in white family wealth after 2007, Asian household wealth rose from 49 to 68 percent of white wealth.

While the authors of the study do not attempt to analyze all the factors causing the large and persistent gap between white and black/Hispanic wealth, they do look at the role of age profiles and educational attainment and conclude that

differences in the age composition and in the level of educational attainment across groups explain relatively little of the gaps. Indeed, race- and ethnicity-related financial-health disparities are greatest among older and better-educated groups, where financial health and wealth generally are at their highest levels.