Cleveland ranks high level for income inequality

Zillow Published:

By Nora Tooher

Cleveland is one of those cities in America where the rich got richer and the poor got poorer during the recession.

A new study from the Brookings Institution states that Cleveland ranks among the 20 largest U.S. cities with the highest levels of income inequality.

The study found that not only is income inequality worse in America’s big cities than the nation as a whole, but it got worse during the recession.

Income inequality was measured as the ratio between those earning more than 95 percent of all others and those earning more than 20 percent of all others.

The big cities with the highest income inequality ratios in 2012 were Atlanta, San Francisco, Miami and Boston. In each of those cities, a household at the 95th percentile of the income distribution earned at least 15 times the income of a household at the 20th percentile.

In Atlanta, for instance, the richest 5 percent of households earned more than $280,000, while the poorest 20 percent earned less than $15,000. Washington, D.C., New York, Oakland, Chicago, Los Angeles and Baltimore made up the rest of the 10 big cities with the highest levels of income inequality.

Cleveland was 17th, with the household income of the poorest 20 percent listed at $9,432 in 2012, compared with a $100,903 household income for the wealthiest 5 percent.

The study said that many of the cities with the worst income inequality were in the South and West – including Sacramento, Calif.; Charlotte, N.C.; Tucson, Ariz.; Fresno, Calif.; and Albuquerque, N.M. – where collapses of home prices reduced work opportunities for poor households.

In places like Cleveland, Indianapolis and Milwaukee, however, poverty deepened as local manufacturing industries declined during the recession

Among the 50 largest cities in the country, just three – Denver, Seattle and El Paso, Texas – showed decreases in income inequality since the start of the recession.

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