In 1970, 92 percent of Americans earned more than their parents at age 30. Now barely half do.
Only 51 percent of 30-year-old Americans make more money than their parents did at the same age, economists and sociologists from Stanford, Harvard, and the University of California have learned. The results of their study reflect a shocking decline from four decades prior, when 92 percent of American 30-year-olds in 1970 earned more than their parents did at a similar age.
"My parents thought that one thing about America is that their kids could do better than they were able to do," Raj Chetty, an economist on the research team who emigrated from India at age 9, told The Wall Street Journal. "That was important in my parents' decision to come here."
It isn't immediately clear why Americans aren't earning as much, but economic growth and the widening income gap are likely causes. Regardless, reversing the trend is a daunting task: "If income distribution remains as tilted toward the wealthy as it is now, [the researchers] calculate, it would take sustained growth of more than 6 percent a year, adjusted for inflation, to return to an era where nearly all children outearned their parents," The Wall Street Journal notes. "Since World War II, the U.S. hasn't experienced anything near that level of growth for a lengthy period of time."
Subscribe to The Week
Escape your echo chamber. Get the facts behind the news, plus analysis from multiple perspectives.
Sign up for The Week's Free Newsletters
From our morning news briefing to a weekly Good News Newsletter, get the best of The Week delivered directly to your inbox.
From our morning news briefing to a weekly Good News Newsletter, get the best of The Week delivered directly to your inbox.
Create an account with the same email registered to your subscription to unlock access.
Sign up for Today's Best Articles in your inbox
A free daily email with the biggest news stories of the day – and the best features from TheWeek.com
Jeva Lange was the executive editor at TheWeek.com. She formerly served as The Week's deputy editor and culture critic. She is also a contributor to Screen Slate, and her writing has appeared in The New York Daily News, The Awl, Vice, and Gothamist, among other publications. Jeva lives in New York City. Follow her on Twitter.
-
Housing costs: the root of US economic malaise?
speed read Many voters are troubled by the housing affordability crisis
By Peter Weber, The Week US Published
-
Feds cap credit card late fees at $8
speed read The Consumer Financial Protection Bureau finalized a rule to save households an estimated $10 billion a year
By Peter Weber, The Week US Published
-
Immigration helped the US economy outpace peers
speed read The U.S. economy grew at an annualized rate of 3.2% last quarter
By Peter Weber, The Week US Published
-
4-day workweek gets boost from UK study
Speed Read Following a six-month trial, the majority of participating British companies are still using the truncated schedule
By Peter Weber, The Week US Published
-
US sues to block Kroger-Albertsons merger
Speed Read The Federal Trade Commission sued to block the $24.6 billion merger between the grocery giants
By Peter Weber, The Week US Published
-
Nvidia sees historic stock rise on AI chips success
Speed Read U.S. chipmaker Nvidia achieved the biggest one-day increase in value of any company in history
By Peter Weber, The Week US Published
-
New York may seize Trump's assets for $450M penalty
Speed Read The former president likely owes $600 million from two civil judgments in New York
By Peter Weber, The Week US Published
-
Capital One to buy Discover for $35B
Speed Read The deal, if cleared by regulators, would create the biggest credit card lender in the country
By Peter Weber, The Week US Published