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Curious About the Distribution of Wealth in the US?

The distribution of wealth in the United States is a hot topic for those interested in sociology, economics, human rights and social justice in general. The ever-growing income disparity in the U.S. (income inequality) is at the heart of social justice movements, political campaigns and economic policy development. Every American from the top to the bottom of the wealth spectrum is affected in many ways by the state of our economy and the widening gap of income equality.

It may seem wealth distribution is a matter of economic data and statistics. But the economy is a representation of socioeconomic conditions and the valuing (or devaluing) of human work and trade. Plus, these socioeconomic conditions are caused and affected by an interconnected collection of factors that result in hierarchies of systemic social stratification. Social stratification and the quantitative and qualitative analysis of economic and social data are fundamental to the multidisciplinary study of sociology, as reflected in the Northern Kentucky University (NKU) Bachelor of Science (BS) in Sociology online degree program.

What Are Recent Trends in Wealth Distribution in the US?

As the adage goes, the rich get richer and the poor get poorer. This saying is quite accurate for the U.S., considering the sky-rocketing income and wealth of the extremely rich and the stagnant income and wealth of the rest of the population. The richest are getting much, much richer as the poorest stay extremely poor.

There is constant debate as to what policies (taxation, regulation, subsidies, government-supported benefits, etc.) best serve the country’s economy. But there is little debate as to the statistics of income inequality inherent to the distribution of wealth in our country. This disparity has been reflected again and again in reports and the analyzation of data collected by many groups, from human rights-focused nonprofits (e.g., Oxfam) to non-partisan policy think tanks (e.g., the Institute for Policy Studies [IPS]) to governmental bodies (e.g., the U.S. Bureau of Labor Statistics [BLS]).

A Snapshot of Wealth Distribution and Income Inequality Statistics in the United States

According to a report by NBER, the top 1 percent of earners in the U.S. in 2016 made, on average, 81 times more than the bottom 50 percent. In the upper echelons of wealth, an IPS report in 2015 found that America’s 20 richest people own more wealth than the least wealthy 50 percent of America’s entire population. The “Forbes 400” wealthiest Americans own more than America’s lowest-earning 194 million people.

BLS and Congressional Budget Office reports reflect similar income and wealth disparities and go deeper into comparing the growth of wealth and income over time. The BLS reports that “real earnings” (adjusted for inflation, etc.) of the lowest earners in the United States have not changed significantly since 1979, whereas the top earners’ income has grown steadily, exponentially so in the top 1 percent and even more so in the top .01 percent.

What Is the Effect of Income Inequality on US Urban Centers and Communities?

Increasing levels of income inequality, the relatively slow rate of inflation and minimum-wage increases, and the growing cost of living in most large urban areas have resulted in drastic change in the fabric and demographics of urban communities in U.S. cities. While many urban centers have generally long been home to lower income families, the relatively recent influx of higher economic class populations to these urban centers has caused substantial gentrification.

Monied people come in, prices of housing, food and services go up, and the locals get pushed out. Gentrification has shaken and dispersed strong, historic communities of people. These localized communities are often generations old. Being priced out of their neighborhoods forces many people to move away from their families, jobs, cultures and support networks.

This has a negative, cyclical effect on the socioeconomic wellbeing of America’s urban low-income citizens. It can denigrate not only the health of people’s economic livelihood (and all aspects of health that stem from that) but also the perpetuation and strength of their cultures and traditions. In addition, the socioeconomic downward spiral of urban communities pushed out by gentrification only serves to further the country’s widening disparity of wealth.

The Bigger Picture for Sociology: Social Stratification

In the context of sociological studies, the distribution of wealth and income inequality in the U.S. (and globally) are considered an aspect of social stratification. Social stratification is a term used by sociologists to describe systems of hierarchy and social class within a society. This broader understanding of socioeconomic status addresses the larger perspective of how resources and power are unequally distributed between lower and upper levels of a society’s hierarchical grouping.

The main variable in how one’s “class” is generally defined is a person’s economic standing (wealth and income). Although economic status is a useful quantitative tool of measurement, sociologists take into account the many other factors that affect a person’s social ranking or socioeconomic status as well as correlations and causality between these various factors. Sociologists focus on the interconnected nature, or the intersectionality, of all of the conditions that affect social stratification of different groups.

The intersectional approach to understanding social stratification recognizes and analyzes the interplay between many factors that affect a person’s socioeconomic class and opportunity. Chief among these factors are the many systems of oppression that still exist in modern society based on race, gender, sexual orientation, religion and economic class.

As reflected in the aforementioned socioeconomic studies, average income and wealth among individuals in oppressed groups is disproportionately low, and staggeringly so for many. Women and members of minority racial groups make a fraction of what white men do for the same work. Social stratification involves many other layers of systemic hierarchy as well, from inherited wealth to social group connections and associated prestige and influence, not to mention access to education to social mobility.

According to intersectionality, these factors of income inequality and social stratification are mutually reinforcing, having causal relationships that lead to the cyclical support of further stratification. In our system of political lobbying (and donation-based funding) by wealthy individuals, corporations and like-minded policy groups, money can truly buy power, leading to legislation and policy that only reinforces systemic socioeconomic inequalities.

From the IPS to Oxfam, socially responsible organizations around the world have proposed many policies and regulations that could help reverse the trend toward income inequality. The power to pursue that reversal lies in the hands of elected officials and other policy makers, making sociology education and democratic participation more important than ever.

Learn more about the Northern Kentucky University online Bachelor of Science in Sociology program.


Institute for Policy Studies: Billionaire Bonanza: The Forbes 400 and the Rest of Us

The National Bureau of Economic Research: Distributional National Accounts: Methods and Estimates for the United States

Oxfam: Reward Work, Not Wealth

U.S. Bureau of Labor Statistics: A Look at Pay at the Top, the Bottom and in Between

Congressional Budget Office: Income Distribution Income Inequality in the United States

Time: 82 Percent of the Wealth Generated Last Year ‘Went to the Richest 1 Percent of the Global Population’

United Nations Global Compact: Making Global Goals Local Business — Argentina

The New York Times: The Fight Over Inequality

Universal Class: A Sociological Perspective on Class and Inequality

CNN Money: U.S. Inequality Keeps Getting Uglier

ThoughtCo.: What Is Social Stratification, and Why Does It Matter?

Lumen: What Is Social Stratification?

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