Wednesday’s data, from the Federal Reserve’s triennial Survey of Consumer Finances, shows the strength of the economic rebound in recent years, but also just how large a hole the recession left in many households’ finances.
The survey is notable for providing information not just on Americans’ yearly income but also on their assets, debts and overall net worth — measures that are in many ways more important to families’ financial security. In terms of income, the typical American has made significant progress in recent years, with median household income nearly back to its prerecession peak.
The broader measures of household finances provided by the survey paint a less rosy picture. The recession sliced nearly 40 percent off the typical household’s net worth, and even after the recent rebound, median net worth remains more than 30 percent below its 2007 level.
For many groups, the recovery is even more incomplete.
Younger, less-educated and lower-income workers have experienced relatively strong income gains in recent years, but remain far short of their prerecession level in both income and wealth. Only for the richest 10 percent of Americans does net worth surpass the 2007 level.
A Yawning Racial Gap
Racial and ethnic minorities experienced the strongest gains in wealth in the 2016 survey, a stark reversal from three years earlier, when the survey showed minority families losing ground even as white families experienced modest gains.
Black families’ net worth rose 29 percent between 2013 and 2016, and Hispanic families had a 46 percent gain; white families saw a more modest 17 percent increase.
The racial wealth gap, however, remains large and continues to grow in absolute terms. The median white family had a net worth of $171,000 in 2016, nearly 10 times that of the median black family.