Higher Wages Aren’t Changing the Widening Wealth Divide

By: Anneken Tappe · November 02, 2023 · Reading Time: 2 minutes

Divergent Earnings

The average American paycheck has grown over the past years. But the fruits of all our economic labor are distributed unevenly across the wealth spectrum.

High-income workers have seen significant increases to their wealth, while others have made only modest gains, underscoring the growing wealth disparity across the U.S.

The Wage Landscape

On the whole, Americans are making more money this year. Wage growth has accelerated 4.6% year-over-year, according to the Bureau of Labor Statistics’ Employment Cost Index..

But the wealth narrative diverges sharply between classes. Top earners, who already have a higher net worth, enjoyed a 22% income boost between 2019 and 2022. Meanwhile, middle class workers with a median net worth lingering below $200,000 gained just 5%.

Wealth Building

This wealth gap is a likely contributor to waning economic optimism among middle class Americans, even in the face of the strong job market and surprising third quarter economic growth.

Are the rich just getting richer? There’s another important aspect to the growing wealth divide: investing. Retail investing has been on the rise, including among younger and more diverse groups.

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