Blacks Trail in Growth of Income Compared to Whites

Blacks Trail in Growth of Income Compared to Whites

Post by NewsToBeRea » Sat, 12 Apr 2008 09:40:19

http://SportToday.org/

 Blacks Trail in Growth of Income

Study Finds Parents' Gains
May Not Protect Children
As Whites Seem to Benefit

By GREG IP
November 13, 2007; Page A4

 Blacks born into the middle class in the late 1960s are far more
likely than whites to earn less than their parents, a new study of
economic mobility has found.

The study examined how children born in the late 1960s fared in the
late 1990s and early 2000s. Overall, it found that two-thirds of the
*** children earned more, adjusted for inflation, than their parents
did at the same age in the late 1960s.

But when the study examined families by race and their rank by income,
they found stark differences between black and white families.

Children of black parents earning in the middle 20% of all families in
the late 1960s had a 69% chance of earning less than their parents,
the study found. For white children, that chance was just 32%.

"Economic success in the parental generation...does not appear to
protect black children from future economic adversity the same way it
protects white children," the study's author, Julia Isaacs, a scholar
at the Brookings Institution, writes in the report, to be released
today.

The study doesn't develop its own explanations for the disparity. But
Ms. Isaacs says other research has raised several possibilities. One
is that black parents have less wealth, in the form of homes or other
assets, than white parents of the same income, which might affect the
economic prospects of their children. Another is that marriage rates
are lower for blacks than for whites, so black children may be more
likely to grow up to be single parents.

Yet another theory is that in the 1960s, black women were more likely
to work than white women, and thus black incomes received less of a
boost as women's overall participation in the labor force rose in
subsequent years.

The report is part of a continuing examination of economic mobility
conducted under the auspices of the Pew Charitable Trusts, with
contributions from Brookings, the American Enterprise Institute, the
Heritage Foundation and the Urban Institute.

The study used data from the Panel Study of Income Dynamics, run by
academics with federal funding, which has been following several
thousand sets of parents and children since the 1960s. The study's
sample comprised 2,367 individuals between the ages of birth and 18 in
1968; their median family income in 2006 was $71,900, up 29%, after
inflation adjustment, from the median income of their parents'
generation.

 Its findings may both contradict and reinforce Americans' image of
their society as highly mobile. On the one hand, it found that
parents' income ranking was a strong determinant of their child's. For
parents born into the bottom 20%, 42% of children were also in the
bottom 20% four decades later. For parents born into the top 20%, 39%
of their children were also there four decades later. On the other
hand, that means the majority of children ended up in a different
income quintile than their parents.

Moreover, the poorest children were the likeliest to do better than
their parents: 82% of the children of parents in the bottom quintile
earned more as ***s than their parents did; that was true of just
66% of children of parents in the middle quintile, and 43% of children
of parents in the top quintile. Ms. Isaacs says it is easier to move
up from the bottom than the top.

But Ms. Isaacs says the experience is quite different depending on
race. For white families, 90% of children born to parents in the
bottom 20% earned more by ***hood; for black families, it was 73%.
In the middle quintile, commonly referred to as the middle class, 68%
of white children grew up to earn more than their parents, but just
31% of black children did.

"Black children and white children do not have equal chances of moving
up the income ladder," Ms. Isaacs writes.