American families managed to accumulate wealth during the COVID-19 pandemic, but Black and Hispanic families lagged behind White and Asian families at all income levels, according to a study by the Pew Research Center released on Monday (4).
The Center analyzed data from the 2020 and 2022 Census to identify wealth disparities among racial and ethnic lines.
Overall, families became wealthier since 2020, even with rising unemployment during the pandemic, the study concluded. This is largely due to the fact that as COVID forced families to isolate, they reduced their consumption of goods, the report states. Three rounds of federal stimulus checks also allowed families to pocket extra money.
Meanwhile, a 31% increase in home values between 2019 and 2021 also helped families accumulate wealth, the study noted. Since most Americans derive their wealth from homeownership, any appreciation in the real estate market translates into higher net worth. The value of the home, or the value of a property minus family debt, represented over 60% of the net worth of Black and Hispanic families in 2021, according to the report.
However, the gains during the pandemic did not help reduce racial wealth disparity, the study concluded.
The typical White family had more than nine times the wealth of a Black family in December 2021 – or $250,400, compared to $27,100.
Immigrants also saw their wealth increase during the pandemic, the report concluded. The average income of immigrant families grew by 42%, from $73,300 in 2019 to $104,400 in 2021. But the wealth of a typical immigrant family still lags behind that of a typical U.S.-born family, which at the time was $177,200.
However, the report showed a significant disparity in wealth generation between Hispanic and non-Hispanic immigrant families. While immigrant families with a Hispanic head had about $35,000 in net worth in 2021, non-Hispanic immigrants held $234,000 in assets.
The study highlights that many non-Hispanic immigrants came from wealthier parts of Europe and Asia and have higher education levels. Additionally, a large percentage of Hispanic immigrants in the United States are younger or newly arrived and have had less time to accumulate wealth.
Source: The Boston Globe and The Pew Hispanic Center