The State of Economic Mobility in the U.S. Government Research Association annual conference Session 8: Economic Mobility and Income Inequality August 6, 2014

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Defining the American Dream 12/26/2018 3

Enduring American Optimism believe that they are in control of their economic situation say that they have achieved or will achieve the American Dream say they earn enough or will earn enough to live the kind of life they want believe they will be better off 10 years from now believe that their own kids will be at least as well off as they are now 68% 61% 54% 12/26/2018 4

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Absolute Mobility A measure of how much better or worse a person is doing in absolute dollar terms than their parents at the same age or themselves over time. 12/26/2018 6

Glass Half Full: 84% of Americans Have Higher Family Incomes Than Their Parents All Adult Children 12/26/2018 7

Relative Mobility A measure of whether people are able to change their rank in the economic distribution compared to their parents at the same age or themselves over time 12/26/2018 8

43% are stuck at the bottom Glass Half Empty: Americans Raised at the Top and Bottom are Likely to Stay There as Adults 4% 40% are stuck at the top 43% are stuck at the bottom 12/26/2018 9

% Change in Median Income The Distance Between the Rungs of the Income Ladder Has Widened Over the Past Generation % Change in Median Income $ 59,300 – $81,700 $ 44,000 – $59,300 Less than $28,900 $ 28,900 – $44,000 $81,700 and above 126% 98% 89% 85% 74% $39,800 and above $30,300 – $39,800 $23,400 – $30,300 Less than $15,600 $15,600 – $23,400 12/26/2018 10

There is a Black-White Gap in Absolute Mobility Whites Blacks 12/26/2018 11

Blacks Are More Likely to Be Stuck in the Bottom and to Fall From the Middle 4% Whites Blacks 56%% 32%% Bottom Quintile Middle Quintile 12/26/2018 12

Couples are more likely to be economically mobile White, couple, no college, children 12/26/2018 13

Single white mothers with no college degree move down White, single woman, no college, children 12/26/2018 14

Single black mothers with no college degree remain stuck Black, single woman, no college, children 12/26/2018 15

Single black mothers with college degree move up Black, single woman, college degree, children 12/26/2018 16

Economic Mobility of Utah and its Neighbors Absolute Relative Upward Relative Downward NATION 17% 34% 28% Utah 23% 44% Colorado 19% 43% 31% Alaska/Idaho/Montana/Wyoming 16% 32% 40% New Mexico 14% 35% Nevada 36% Arizona 15% 33%

Key Mobility Drivers Financial Capital Human Capital Social Capital 12/26/2018 20

Social Capital: A Majority of Black Children Live in High-Poverty Neighborhoods Neighborhoods with: 30% or more poor 20 – 29.99% or more poor 1% 1% Born 1955 – 1970 Born 1985 – 2000 12/26/2018 21

Human Capital: A College Degree Promotes Upward Mobility and Prevents Downward Mobility 3% Non-college grads College grads 4% Bottom Quintile Top Quintile 12/26/2018 22

Bottom Income Quartile Financial Capital: Personal Savings Promotes Upward Mobility from the Bottom 50% 71% Bottom Income Quartile 12/26/2018 23

21x 6x 8x 12/26/2018 24

Next Step: Educating Policymakers and the Public What Pew has done: Strange bedfellows coalition Bipartisan Road Map Economic Mobility Caucus Reporter relationships

Next Step: Educating Policymakers and the Public What advocates can do: Be thoughtful about language Engage diverse partners Share research and analysis Challenge policymakers to make economic mobility a goal

Contact Information Erin Currier Director, Financial Security and Mobility ecurrier@pewtrusts.org Diana Elliott Research Manager, Financial Security and Mobility delliott@pewtrusts.org www.economicmobility.org