March 12, 2014

Income Inequality in US and Connecticut Cities

A report from the Brookings Institution looks at income inequality in the 50 biggest cities in the United States. Researchers used data collected annually by the Census Bureau to compare the income of those in the top 5% income bracket against those in the bottom 20% to make a ratio. As the report explains, “it represents the distance between a household that just cracks the top 5 percent by income, and one that just falls into the bottom 20 percent” — the larger the ratio, the greater the inequality.
The cities with the five highest ratios were Atlanta (18.8), San Francisco (16.6), Miami (15.7), Boston (15.3), and Washington, D.C. (13.3).

The cities with the five lowest ratios were Virginia Beach (6.0), Arlington, Texas (7.3), Mesa, Arizona (7.5), Las Vegas (7.7), and Wichita, Kansas (7.7).

The ratio in 2012 for the United States as a whole was 9.1 and researchers found that 31 of the 50 largest cities had higher ratios than the national average.

The Brookings Institution researchers note there are a variety of reasons for inequality. San Francisco’s wealthy are extremely wealthy (they speculate that rising housing prices may have pushed many poor people out of the city). Miami’s poor, on the other hand, are very poor.

Using the same data from the Census Bureau’s American Community Survey, one can calculate the ratio for Connecticut’s cities. Ratios range from a low of 7.66 in Danbury to a high of 12.68 in Hartford. For comparison, the table below also includes the 2007 ratios, which shows how the recession affected income inequality.

City
2007
2012
change in 20%
change in 95%
20%
95%
ratio
20%
95%
ratio
Bridgeport
17,098
136,501
7.98
15,077
140,860
9.34
 2,021
 (4,359)
Danbury
27,089
194,311
7.17
24,119
184,706
7.66
 2,970
 9,605
Norwalk
33,872
278,519
8.22
28,463
250000
8.78
 5,409
 28,519
Stamford
35,670
393,783
11.04
31,017
250000
8.06
 4,653
 143,783
Hartford
11,286
112,733
9.99
9,436
119,685
12.68
 1,850
 (6,952)
New Britain
17,393
118,027
6.79
12,452
136,694
10.98
 4,941
 (18,667)
New Haven
15,523
132,910
8.56
13,147
156,964
11.94
 2,376
 (24,054)
Waterbury
16,069
126,606
7.88
15,672
135,618
8.65
 397
 (9,012)
* the median falls in the upper interval of an open-ended distribution

Source: American Community Survey, Data Table B19080, 2012 and 2007.