Uneven Recovery: Lion's Share of Income Growth Captured by Extremely Small Income Elite

University of California-Berkeley economist Emmanuel Saez recently released an updated report on his study, “Striking It Richer: The Evolution of Top Incomes in the United States” (originally published in Pathways Magazine, Stanford Center for the Study of Poverty and Inequality, Winter 2008, 6-7). The report examines the effects of the recovery from the 2007-2009 Great Recession on average real income per family.

Using 2009-2012 tax data, Saez found that all income groups did not benefit from the recovery evenly. "Top 1% incomes grew by 31.4% while bottom 99% incomes grew only by 0.4% from 2009 to 2012. Hence, the top 1% captured 95% of the income gains in the first three years of the recovery. From 2009 to 2010, top 1% grew fast and then stagnated from 2010 to 2011. Bottom 99% stagnated both from 2009 to 2010 and from 2010 to 2011. In 2012, top 1% incomes increased sharply by 19.6% while bottom 99% incomes grew only by 1.0%."

This study provides further evidence of growing income inequality in the US and suggests that the economic downturn had only a temporary effect on income concentration.