Brookings

By Richard V. Reeves and Ariel Gelrud Shiro

June 24, 2021

Here in the Future of the Middle Class Initiative, we have done a lot of work on how we define the American middle class and how race plays into those definitions. In their new paper, William Darity Jr., Fenaba R. Addo, and Imari Z. Smith explore the state of the Black middle class using data from the 2016 Survey of Consumer Finances (SCF). The authors show that for each quintile of the income distribution (within race), the median income level for Black Americans is significantly lower than for whites. The gaps are even wider when looking at the wealth distribution – particularly at the top. The median wealth in the top quintile of the white wealth distribution is $1,590,000 – for Black Americans, it’s $283,000. The authors call this the “lower ladder phenomenon”: Blacks at the top of their group-specific distribution are at a rung far below whites at the top of their racial group’s social ladder. This means that a Black family in the middle of the Black wealth distribution (what some would consider the Black middle class) would be in the bottom or second quintile of the white distribution. To grow the Black middle class, the authors argue for “a comprehensive national program… that is aimed directly at removing racial wealth differences.”