Wealth gap widened during the recovery

The wealth gap has widened along racial and ethnic lines during the economic recovery, a newly released report showed on Friday.

While the recession dented the wealth of all U.S. households, whites have rebounded at a faster rate than other groups.

{mosads}Overall, the wealth of white households was 13 times the median wealth of black households in 2013, compared with eight times in 2010, according to a new Pew Research Center analysis.

Pew used data from the Federal Reserve’s Survey of Consumer Finances to reach its conclusions.

In fact, the gap between black and white households is at 25-year high, when white households had 17 times the wealth of black households.

In addition, the wealth of white households was more than 10 times that of Hispanic households, up from nine times in 2010, a level last seen in 2001.

Excluding race and ethnicity, the net worth of American families overall — the difference between assets and liabilities — held steady during the economic recovery.

The typical household had a net worth of $81,400 in 2013, only slightly below 2010 levels, according to the Fed’s survey.

Household wealth fell sharply — by 39.4 percent — between 2007 and 2010, to $82,300 from $135,700, as housing prices and stock market values tanked.

The Pew analysis shows a stark divide in the experiences of white, black and Hispanic households during the economic recovery.

From 2010-2013, the median wealth of white households increased to $141,900 from $138,600 or by 2.4 percent.

Meanwhile, the median wealth of black households fell 33.7 percent to $11,000 in 2013 from $16,600 in 2010.

Among Hispanics, median wealth decreased by 14.3 percent, to $13,700 from $16,000.

For all families — white, black and Hispanic — median wealth is still less than its pre-recession level.

The median income of minority households (blacks, Hispanics and other non-whites combined) fell 9 percent from the Fed’s 2010-2013 surveys, compared with a decrease of 1 percent for white households.

A number of factors seem responsible for the widening of the wealth gaps during the economic recovery that include a lack of savings, the slow recovery of income and a different mixture of assets. 

For example, white households are more likely to own stocks, which have increased in value.