- White Americans increased their wealth by $9.58 trillion from the end of 2019 to the end of 2020.
- Black Americans also increased their total household wealth, by $520 billion.
- The data shows the wealth gap persisted in 2020 amid the pandemic.
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The systemic exclusion of Black Americans from employment, home ownership, and generational wealth is not a new story.
And the wealth gap between Black and white Americans has only persisted: In the fourth quarter of 2020, white households had a total net worth that was over 20 times that of total wealth held by Black households.
White Americans have held most of the total wealth since the end of 1989, the first year with available data from the Federal Reserve’s Distributional Financial Accounts. This continued in 2020, when white wealth grew from the last quarter of 2019 to the last quarter of 2020 more than it did for Black or Hispanic Americans.
The following chart highlights aggregate household wealth by race and ethnicity over the past two decades:
From the last quarter of 2019 to the last quarter of 2020, total household wealth of white Americans increased by $9.58 trillion to $103.40 trillion. Black Americans increased their total household wealth by $0.52 trillion, from $4.46 trillion in the fourth quarter of 2019 to $4.98 trillion in the last quarter of 2020.
Aggregate wealth for Hispanic households increased by $0.26 trillion in the fourth quarter of 2020 compared to the same time a year earlier, for a total of $2.89 trillion in the fourth quarter of 2020.
The above chart shows the sum total of all wealth held by households in each racial and ethnic group, but those groups do not make up equal shares of the US population. To get a sense of the racial wealth gap at the level of individual families, we can also look at average household wealth in each group.
The following chart highlights total wealth by race and ethnicity per household over the past two decades using data from the Distributional Financial Accounts:‘s
The chart similarly illustrates that wealth held per white household is much higher than the wealth held by Black and Hispanic households. Even before the pandemic, white households held more wealth.
Those averages may look very high, but this is a side effect of the fact that wealth is often concentrated at the very top within each of the racial and ethnic groups above. Average values were much higher than the typical, or median, wealth among households in each racial or ethnic group.
Although smaller, the racial wealth gap still shows up when looking at the median household. The Federal Reserve wrote that based on 2019 Survey of Consumer Finances, the most recent year available, white families had a median wealth of $188,200, compared to $24,100 for Black families, and $36,100 for Hispanic families.
That means, according to the Fed, a white family “has eight times the wealth of the typical Black family and five times the wealth of the typical Hispanic family.”
A report from the Center for American Progress finds that these lower levels of wealth left the Black community more vulnerable to both the physical and fiscal risks of the pandemic. The report traces the Black-white wealth gap to a “discriminatory economic system that keeps Black households from achieving the American dream,” which encompasses everything from housing market discrimination to labor market discrimination to exclusion from financial systems.
Not only was there an unequal wealth distribution in 2020, but recovery amid the pandemic seems to also be unequal when looking at recovery by race and ethnicity. The Economic Policy Institute (EPI) analyzed data from the last two quarters of 2020 to see how unemployment rates differed by race and ethnicity around the nation.
“While unemployment rates fell for all groups over the third and fourth quarters, Hispanic unemployment remained 60% higher than white unemployment, while Black unemployment rose from 60% higher to 90% higher,” EPI wrote.
In fact, EPI found that in the third quarter of 2020, “there were no states where Black and white workers were equally likely to be unemployed.” Although the unemployment rate for both Black and white Americans is lower than the rates seen last spring, the Black unemployment rate was 4.3 percentage points higher than the white unemployment rate in February 2021.