MEDIA RELEASE: "The Increasingly Unequal States of America"—U.S. experienced widening income inequality in recent decades, new report finds

NC is among states in which all income growth was accrued to top 1 percent between 2009-2011

RALEIGH (February 19, 2014)—All 50 states have experienced widening income inequality in recent decades, according to a new report published by EPI for the Economic Analysis and Research Network (EARN).

The Increasingly Unequal States of America: Income Inequality by State includes state-level analysis of income trends from 1917-2011. The report shows that between 1979 and 2007 states reflected the national pattern of extreme income inequality growth, with the top 1 percent of taxpayers capturing 53.9 percent of all income growth. The average income of the bottom 99 percent of U.S. taxpayers grew by 18.9 percent, while the average income of the top 1 percent grew over 10 times as much—by 200.5 percent. After incomes at all levels declined as a result of the Great Recession, lopsided income growth has reemerged since the recovery began in 2009, with the top 1 percent capturing an alarming share of economic growth.

“The levels of inequality we are seeing across the country provide more proof that the economy is not working for the vast majority of Americans and has not for decades,” said Mark Price, an economist at the Keystone Research Center and co-author of the report with Estelle Sommeiller. “It is unconscionable that most of America’s families have shared in so little of the country’s prosperity over the last several decades.”

Read the report here.

The report finds that rising inequality has become a pervasive trend across the U.S. Between 2009 and 2011, the top 1 percent captured between half and all income growth in 33 states.

Key findings for North Carolina include:

  • OIverall, the state experienced 44.8 percent income growth overall between 1979 and 2007. The top 1 percent of North Carolina earners experienced 172 percent growth during that time, while the other 99 percent experienced 32.1 percent income growth. The top 1 percent had 34.8 percent share of the total growth captured during that period.
  • North Carolina experienced a 1.6 percent drop in overall income growth between 2009 and 2011. During the same period, the top 1 percent saw 6.2 percent increase in income growth, and the bottom 99 percent saw a decrease of 2.9 percent.
  • The average income for the top 1 percent of North Carolina earners in 2011 was $702,503, versus $39,145 for the bottom 99 percent.  The income held by the top 1 percent has reached levels not seen since 1928 when the top 1 percent had $19 for every $1 dollar held by the bottom 99 percent.

“While North Carolina experienced a longer period of income growth for the bottom 99 percent in the post-War period up until the 1990s, the ratio of income held by the top 1 percent to the bottom 99 percent has reached near-historic levels not seen since 1928,” said Alexandra Sirota, Director of the Budget & Tax Center, a project of the North Carolina Justice Center.

Inequality in fact declined for four decades between the 1940s and the 1970s in the U.S., the report finds, making the extreme levels of inequality seem far from inevitable. In 1928, the top 1 percent of North Carolina earners made up 16.7 percent of all income, versus 9.1 percent in 1979. By 2007, however, the top 1 percent was earning 17.0 percent of all income, an 8.0 percentage point increase from 1979—almost the exact inverse of the change between 1928 and 1979.

“It’s clear that policies were set to favor the one percent and those policies can, and should, be changed,” said Doug Hall, director of the EARN program. “In order to have widespread income growth, bold policies need to be enacted to increase the minimum wage, create low levels of unemployment, ensure a progressive tax code and strengthen the rights of workers to organize.”

A report on North Carolina data will be forthcoming later this week. Contact Alexandra Sirota for a copy.

FOR MORE INFORMATION CONTACT: Doug Hall, Director of EARN, 202.331.5519 202.331.5519; Alexandra Sirota,, 919.861.1468 919.861.1468.