Writing for the Washington Post’s Wonkbook blog, Jim Tankersley reports some good news for the American middle class, but it is wrapped inside some continuing bad news about growing income inequality:
“The vast majority of American workers are finally seeing their incomes rise from the depths of the Great Recession, a new analysis from one of the world’s leading scholars of economic inequality suggests. But incomes for the top 1 percent continue to rise substantially faster.
“The analysis of Internal Revenue Service data on pre-tax earnings, from UC-Berkeley economist Emmanuel Saez and published by the Washington Center for Equitable Growth think tank, finds incomes increased by 3.9 percent last year for the bottom 99 percent of U.S. families. That’s the strongest growth those workers have seen since 1998, but it’s still not enough to repair all the damage the recession wrought on those workers: As Saez notes, those families on average have only regained two-thirds of the income they lost during and after the financial crisis.
“The top 1 percent, in contrast, have now regained almost all the income they lost during the recession. Their incomes grew by 7.7 percent, almost double the rate of the bottom 99 percent of workers, in 2015. Other work this spring has also suggested typical worker income growth is accelerating, including an analysis by former Clinton administration economic adviser Rob Shapiro that finds mounting income gains for young workers in particular in recent years.”
Tankersley’s complete article is available at: https://www.washingtonpost.com/news/wonk/wp/2016/07/01/the-middle-class-just-had-its-best-year-in-nearly-two-decades/?wpisrc=nl_wonk&wpmm=1.
This graph is almost ten year’s old, but the gap between the top line and the rest has simply widened even more over that time: