Not all Americans are able to pull themselves up by their bootstraps.
Children raised in low-income American families will likely also have very low incomes as adults, while children raised in high-income families can anticipate a much bigger jump in income, according to a report — “Economic Mobility in the United States” — released Thursday by researchers at Stanford University. It was funded by The Pew Charitable Trusts, a nonprofit public policy organization based in Washington, D.C., and the Russell Sage Foundation, a nonprofit research center in New York City that focuses on social sciences.
And the wage gap for people from different backgrounds is significant: The expected income of people raised in well-off families in the 90th percentile — that is, the top 90% of the national median household income — is about 200% larger than the expected income of children raised in poor families (in the 10th percentile) and about 75% larger than that of children raised in middle-class families (in the 50th percentile). What’s more, people raised in middle-class families will earn close to double what children from lower-income families earn in adulthood.
Previous research shows that economic segregation and neighborhoods also plays a role in preventing multiple generations of lower income Americans from achieving the American dream, which generally consists of doing significantly better than the previous generation. Inequality between the wealthiest and poorest American neighborhoods grew most substantially in the largest commuting zones — where people live next to large urban centers — between 1990 and 2010, according to a recent report by the nonprofit Urban Institute. Some areas have effectively created gated communities through public zoning, it said.