NewsFlash: March 28, 2007
Recent Gains Only Went to Highest Incomes
The economy expanded in 2005, but many families did not benefit from that growth. A new EPI Snapshot finds that all of the incomes gains of that year – the most recent year available for this data – only went to households in the top 10 percent.
EPI president Lawrence Mishel and senior economist Jared Bernstein examine new data on income inequality by focusing on gains by percentile. Income growth among the top half of the top 1 percent—a group whose average annual income is already $1.8 million—was up 16 percent in 2005 alone. Meanwhile, income stagnated for the bottom 90 percent. The Snapshot suggests that factors such as diminished union presence and surging CEO pay are funneling growth to the top of the income scale.
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