Recession Hurt The One Percent, Yet The Wealth Gap Remains Huge

Recession Hurt The One Percent, Yet The Wealth Gap Remains Huge

The recession was hard on everyone, even the one percent. Just not enough to put too large a dent in the overall wealth gap.

Income for the very highest earners in America, or the "one percent" whom the Occupy Wall Street movement has expended so much energy protesting, dropped noticeably between 2007 and 2009, when shocks seized the financial industry and the U.S. economy rapidly contracted. By 2009, one percenters were taking home 17 percent of the country's income, compared with 23 percent just two years before, The New York Times reports.

Hard times are relative, though. Even as the one percent saw their income dwindling in 2009, their net worth was still more than 200 times higher than that of the median household, according to the Economic Policy Institute.

The earning power of the one percent has been a subject of heated debate since the ascent of Occupy Wall Street, whose participants often cite income inequality as one of the most pressing problems in America. With the national economy struggling to gain momentum, and millions of people hard-pressed just to afford basic household necessities, critics of income inequality have been asking why some in America need to earn so much while others have so little.

Despite concerns about the growing wealth gap, the wealthiest Americans were worse off just like everyone else by 2009, after a recession that hit the financial sector hard. The average income of the one percent fell to $957,000 from $1.4 million in 2007.

But that's not to say the wealth gap closed. In fact, a report from the EPI asserts that the gap grew even larger during the Great Recession, likely as a result of skyrocketing unemployment and plunging home values.

Households in the one percent had a net worth in 2009 that was 225 times higher than that of the median household -- the highest that ratio has ever been.

Today, the annual median wage is just $26,364, meaning that half of households earn less than that. There are at least 46 million Americans in poverty, possibly more. One person in every five is struggling to put food on the table.

Meanwhile, the rich haven't bounced back entirely -- analysts believe that incomes for the top one percent are likely still lower than they were before the recession -- but the NYT notes that strong Wall Street performances in 2010 probably helped the one percent recoup some of their 2009 losses.

In general, the past 30 years have been a time of historic divergence between the rich and the poor. Wages for the bottom 99 percent have risen only modestly since 1979, but wages for the one percent have almost tripled in the same period, leading to a wealth gap that one economist has described as "Gilded Age levels of inequality."

CORRECTION: An earlier version of this post misstated that the U.S. median income is $26,364. The U.S. annual median wage is $26,364.

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