The recovery from the Great Recession disproportionately benefitted the wealthiest 1 percent of District residents, while the city’s poorest residents were left behind. Nearly two thirds of recent income growth in DC has been captured by the top 1 percent, who now take home $1 of every $5 earned in the District. At the same time, the average income of the poorest DC families has fallen in recent years. To ensure future growth is shared more equally, DC should enact policy initiatives such as increased affordable housing investments, paid family leave, and fair scheduling for workers.
A new paper from the Economic Policy Institute analyzes the most recent IRS data to examine how the 1 percent and 99 percent have fared from 1917 to 2013. Here are the key findi
ngs for the District:
- The top 1 percent captured 60 percent of overall income growth in the city during the 2009 to 2013 economic recovery.[1]
- The District is substantially more unequal than the metropolitan area overall (See Figure).
- The top 1 percent now take home 19 percent of all the income in DC, meaning for every $5 of income earned in the District, about $1 goes to someone in the top 1 percent.
- The average income of the top 1 percent is over $1.5 million, while the average income of the other 99 percent is $63,000.[2]
This research is in line with DCFPI’s research from earlier this year, which found that the poorest fifth of DC’s households have seen their incomes decline since the Great Recession, while DC’s high-income households are among the wealthiest in the nation.
The District should take steps to help boost the incomes and employment prospects of families that struggle the hardest to make ends meet, including passing legislation on paid family leave and fair scheduling, as well as increasing existing efforts to make more housing affordable.
[1] Between 2001 and 2007, the top 1 percent took home 30.1 percent of income growth — half the share captured in recent years.
[2] Figures in 2014 dollars.
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