By William Emmons, Lead Economist, Center for Household Financial Stability
The wealth (or net worth) of non-white families grew faster than that of white families over the past three years. Still, wealth gaps between these groups remain significant.
According to the Federal Reserve Board’s 2016 Survey of Consumer Finances,1 the mean (or average) wealth of an American family was 25.5 percent higher in 2016 than it was three years earlier, reaching $692,100.2 The median (or typical) wealth of an American family was 16.2 percent higher in the later year, measuring $97,300.3
Unlike the period between 2010 and 2013 and in many previous three-year intervals, non-white families’ wealth generally increased faster than that of white families between 2013 and 2016:
A similar story can be told with median wealth as well:
The result is that racial and ethnic wealth gaps measured either as means or as medians generally decreased between 2013 and 2016, as the figures below show.
It’s also clear, however, that racial and ethnic wealth gaps remain very large on both measures. Moreover, the gaps haven’t changed much since 1989, in the case of black and Hispanic families, and actually have increased for the group that includes all other families.
1 See “Survey of Consumer Finances,” Federal Reserve Board, Sept. 27, 2017.
2 All figures are adjusted for inflation and expressed in 2016 dollars.
3 Median wealth corresponds to the family precisely in the middle when ranking all families by wealth. Mean wealth is much larger than median wealth, indicating that wealth-holding is skewed toward (i.e., concentrated in) wealthier families. Mean wealth increasing faster than median wealth between 2013 and 2016 implies that the distribution of wealth became even more skewed during this period.
4 Families are classified according to their own self-identification in the survey. Groupings used here are white non-Hispanic; black or African-American non-Hispanic; Hispanic or Latino; and all other, which includes Asian, American Indian, Alaska Native, Native Hawaiian, Pacific Islander, other race or more than one race.