Next Page:

Income inequality

The top 10% of the income distribution has claimed almost two-thirds of the gains to overall incomes since 1979, with the top 1% alone claiming 38.7% of overall gains.

The stunning growth of income inequality in the U.S. economy that characterized the last 30 years was not always the norm.  Between 1947 and 1973, economic growth was both rapid and distributed equally across income classes.  The poorest 20% of families saw growth at least as fast as the richest 20% of families, and everybody in between experienced similar rates of income growth.  Since then, growth in average living standards has unambiguously slowed.  Between 1973 and 1995, growth in productivity, or how much income can be generated in each hour of work, collapsed to less than half the rate that characterized the previous quarter century.  Since 1995, productivity growth has risen sharply, but it remains well below the progress that prevailed between 1947 and 1973.

And, as shown in the above charts, this slower growth has been accompanied by a dramatic rise in inequality.  The growth of typical families’ incomes, which once mirrored overall productivity growth, began flattening in the late 1970s, falling far behind productivity growth.  The poorest families saw their real income actually shrink, while income growth increased notably higher up the income scale.

The chart above shows how increases at the top squeeze growth in the middle.  The lines show actual growth in median family incomes as well as the growth that would have prevailed had there been no increase in inequality over the period—that is, if all incomes had growth at the overall average rate. Had this happened, the median family today would have incomes $9,220 higher.

This chart represents the amount of overall national income the bottom 99.5% of the population has to share.  All but the top one-half of one percent (0.5%) of the U.S. population receives 83.1% of all household income, an amount that has shrunk over 10% since 1973. In essence, it is like the bottom 99.5% of the population had incomes cut by 10%, simply as a result of the growth in inequality over that time.

Get the data behind the charts.

Explore Our Charts



Select a subject or demographic

Interactive feature

Interactive feature promo image When income grows, who gains?

For the media

Economic Policy Institute Media Relations Department (202) 775–8810 |