Study: Wealth Gap Between Whites and Minorities at Highest Recorded LevelBy Daniel Cherry | Published 19 Sep 2011 09:24am |
The wealth gap between whites and minorities continues to widen in the U.S. MPB's Daniel Cherry reports why wealth is getting more difficult to obtain for some and what impact that's having in Mississipppi.
The average wealth for a white family is 20 times more than an African American family. In other words, the Pew Research Center says the average net worth of a white household is 113 thousand dollars....a black household is only worth 56 hundred dollars. Rakesh Kochhar is a researcher with Pew. He explains why.
"It was principally the collapse of the housing market that drove down the wealth of minority households who are much more dependent than white households on home equity as a source of wealth."
Mississippi hasn't been immune to the housing market collapse. Home prices fell about 23 percent for the first quarter of this year for the Gulfport/Biloxi area...the largest drop in the nation. Mark McComb is the Director of the Center for Economic Research and Analysis at Mississippi College.
"People had thought before the Great Recession that perhaps there was a way through things, venues like the improvement in education, higher graduation rates for people of color and minorities, that, that would give them, if you will, the ticket into the American mainstream ability to accumulate capital."
McComb says confidence of closing the wealth gap is fading. The most bankruptcies now are among college graduates. Something McComb says shows higher education is getting out of reach for poorer families.
"Folks that would have chosen some improvement opportunity in various forms of education, are going to have to opt not to do that. Then, you're right back into that cycle. That means they're not getting skilled for income improvements in the future and so on."
McComb says the recession's impact on Mississippi was comparatively low considering the state's high poverty rate and an already wide wealth gap.
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