(June 22, 2012) The economic downturn continues to show the dire straits minorities in America have been facing as the wealth gap between Whites and people of color widened dramatically with the housing market crash as the culprit.
A report issued by the U.S. Census Bureau says that between 2005 and 2010, Hispanics lost 50 percent of home equity going from $90,000 to $45,000 while Blacks lost nearly 30 percent going from $70,000 to $50,000. Whites on the other hand lost just 10 percent going from $100,000 to $90,000.
Experts say that because minorities had so much of their net worth tied up in their home equity that when the market crashed it led to a staggering loss of wealth.
“Richer people owned more bonds that didn’t get killed,” Scott Hoyt, an economist at Moody’s Analytics, told the USA Today. “For middle-income households, their primary asset is their house, and the government stimulus backstopped incomes at the low end.”
Figures from the Census report that in 2010, Whites median value of assets was $110,729 while for Blacks it was only $4,955 and for Hispanics was only $7,424. Those numbers compared to those in 2005 show that non-Hispanic Whites had median value of assets of $130,350 with Blacks at $11,013 and Hispanics at $17,078 showing a White-Black ratio that went from 12-1 to 22-1 and a White-Hispanic ratio that went from 8-1 to 15-1.
Overall U.S. median household net worth declined 35 percent according to the Census from $102,844 to $66,740 from 2005 to 2010.
The report also underscored the importance of a college degree. The median value of assets for those with bachelor’s degrees is nearly three times that of those with only a high school diploma $142,518 to $42,223.