Report: Richest 1% Increase Their Share of Post-Pandemic Wealth

The pandemic reportedly did little to close the gap between the rich and the poor.

Despite some belief that a robust job market and strong wage gains would bridge the divide, the richest Americans are seeing their wealth increase, Reuters reported Monday (Oct. 9).

Federal Reserve data showed that the top 1% of households held about 26.5% of household net worth at the end of June, compared to around 25% in 2019, per the report. And new Census Bureau estimates said the share of income going to the top 5% grew from 23% in 2019 to 23.5% in 2022.

For the lowest 40% of workers by income, that means a smaller share of wealth, despite rising net worth levels, according to the report. That collective net worth jumped 27% from $3.3 trillion in 2019 to $4.2 trillion in 2023, although their share of the national wealth dipped from 7% to 6.7%.

The data paints the recent wage increases for lower-income and less educated workers in a new light, the report said.

“If you think they have any leverage, it is leverage to what end?” Elise Gould, senior economist at the labor-focused Economic Policy Institute, told Reuters. “Share matters because if profits have been so high, wages could have done even better.”

The wealthiest 20% of Americans still have some of the excess savings they built up during the pandemic, while the rest have exhausted those funds, per Fed data.

That other 80% has seen a drop in bank deposits and liquid assets since the peak of the pandemic in 2021, while the wealthiest one-fifth of households still have cash savings about 8% above pre-pandemic levels.

Meanwhile, many Americans are beginning to buckle under the pressure of high prices in ways that weren’t obvious even last year, PYMNTS’ CEO Karen Webster wrote Monday.

“More concerning is how consumers now manage their everyday expenses, including how they prioritize and pay their monthly bills,” she wrote. “There, the relevant number is 41% — the share of U.S. consumers who now say they make partial payments to meet their monthly financial obligations who didn’t before. So today, we see a consumer whose behavior is much different than it was a year ago — and in ways that will likely impact everyone and every business for the rest of this year and into 2024.”