Average American households are becoming poorer and losing stability.
That’s the alarming finding of a top economist who says the median net worth of households across the United States has plummeted to a 43-year low.
Edward Wolff, a respected economics professor at New York University, set the nation’s median net worth is now at $57,000. It hasn’t been so low since 1969.
Wolff also reveals that between 1983 and 2007, the percentage of American households with less than $10,000 in assets rose from 29.7 percent to 37.1 percent.
“The debt of the middle class exploded from 1983 to 2007, already creating a very fragile middle class,’’ Wolff
said in the study, presented this month at the Association for Public Policy Analysis & Management conference in Baltimore.
During that same rocky period, the wealth of the richest one percent of households rocketed by 71 percent.
“Wealth differences have become exacerbated,’’ he said. “The rising polarization is rather troubling,’’ Wolff said.
He said the racial and ethnic disparity in wealth holdings, after remaining “more or less’’ stable from 1983 to 2007, widened between 2007 and 2010.
“Hispanics, in particular, got hammered by the Great Recession in terms of net worth and net equity in their homes,’’ Wolff said.
“Households under age 45 also got pummeled by the Great Recession, as their relative and absolute wealth declined sharply from 2007 and 2010.’’
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