The Great Recession took its toll on millions of Americans, but even more so for black and Hispanic families, a new study shows.
According to the Urban Institute, the existing racial wealth gap became even bigger since the start of the economic downturn. In 2010, the average white family was six times wealthier ($632,000) than the average black ($98,000) or Hispanic family ($110,000). That’s up from 1983, when the average white family was five times as wealthy in comparison to the average black or Hispanic family.
“While the Great Recession didn’t cause the wealth disparities between whites and minorities, it did exacerbate them,” the study says.
Wealth was measured by total assets, including home value, bank and retirement accounts, student loans and credit-card balances.
The study by the nonpartisan, research organization also found that between 2007 and 2010, Hispanic families’ wealth dropped a jaw-dropping 44%, largely due to falling home prices. Black families’ wealth dropped 31%, the study attributed the drop to hits on retirement assets and high rates of unemployment during the recession from 2007 to 2009. White wealth also dipped, but at 11% was a much smaller drop.
The study also showed that the income gap between whites and minorities groups was smaller, but substantial. In 2010, the average income for whites was twice that of blacks and Hispanics—$89,000 compared the $46,000. That means for every $2.00 whites earned, blacks and Hispanics earned just $1.00.