U.S. median pre-tax family income by race

The table below shows the median pre-tax family income in the U.S., separated by race.

Since the median is the middle value of a distribution, this data, as opposed to the mean/average, does not take into account the general overall income inequality in the country. That is, when you take into account that a small portion of the U.S. population makes far more than most in the country, those incomes skew the average higher. By using the median, we are avoiding that skew from ultra-high-income individuals.

In an equal country, what we would expect to see is a median income that’s roughly equal across races. Since we’re talking about millions of families, living all over the country, the sample should be large enough that if race didn’t play a role in family income, we’d see similar family incomes across races.

As is quickly evident, that is not the case. The second table simply takes the data in the first and compares White family incomes to non-White family incomes. As can be seen in that second table, not only are White family incomes significantly higher than non-White families (1.7 times the median Black family income and 1.6 times the median Hispanic family income), with the exception of the three years between 1989 and 1992, there hasn’t been meaningful progress in closing the gap between White and non-White incomes over the past 24 years.

Median before-tax family income ($ in thousands)

1989 1992 1995 1998 2001 2004 2007 2010 2013 2016
Black 11.5 17.1 17.3 19.3 25.0 27.9 31.3 30.5 31.2 35.4
White 30.3 30.7 33.1 38.1 45.3 49.4 51.8 52.8 55.8 61.2
Hispanic/Latino 14.6 17.2 21.7 23.5 24.7 27.3 36.0 35.1 32.5 38.5
Other 22.6 27.7 35.1 33.4 35.0 45.2 50.6 42.2 41.2 50.6
Source: Federal Reserve
https://www.federalreserve.gov/econres/scfindex.htm

Median White before-tax family income versus non-White family income

1989 1992 1995 1998 2001 2004 2007 2010 2013 2016
White/Black multiple 2.6x 1.8x 1.9x 2.0x 1.8x 1.8x 1.7x 1.7x 1.8x 1.7x
White/Hispanic multiple 2.1x 1.8x 1.5x 1.6x 1.8x 1.8x 1.4x 1.5x 1.7x 1.6x
White/Other multiple 1.3x 1.1x 0.9x 1.1x 1.3x 1.1x 1.0x 1.3x 1.4x 1.2x
Source: Federal Reserve and author’s calculations.
https://www.federalreserve.gov/econres/scfindex.htm

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google photo

You are commenting using your Google account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s

%d bloggers like this: