According to the report by the Institute for Policy Studies and Prosperity Now, the wealth gap between people of color and their white counterparts is showing no sign of narrowing in the coming years—even as racial demographics in the U.S. are rapidly shifting, with people of color projected to make up the majority of the population by 2043.
In the next three years, black households are projected to lose 18 percent of their median net worth, while white families are expected to gain about three percent more wealth.
The report, “The Road to Zero-Wealth,” defines middle-class wealth as a household net worth of $68,000 to $204,000, and notes the disconnect between income and wealth: a median income for one’s racial background does not guarantee entry into the middle-class.
“White households in the middle income quintile—those earning $37,201-61,328 annually—own nearly eight times as much wealth ($86,100) as Black middle-income earners ($11,000) and ten times that of their Latino counterparts ($8,600),” write the authors.
Black Americans are also unable to accumulate middle class wealth even with high levels of education:
If we consider educational attainment—often considered as the “great equalizer” between the rich and the poor and between families of different racial and ethnic backgrounds—White families whose head of household holds a high school diploma have nearly enough wealth ($64,200) to be considered middle class. A typical Black or Latino family whose head of household has a college degree however, owns just $37,600 and $32,600, respectively, in wealth.