Current Weather
The Spy FM

Americans Earn More Than Their Parents (With A Caveat), Study Says

Filed by KOSU News in US News.
February 27, 2013

Most Americans are earning more money than their parents, according to a new study from Pew’s Economic Mobility Project. But those gains don’t tell the whole picture.

Let’s start with the good news. The Pew Charitable Trust study looked at actual pairs of children and parents. Around age 40, 83 percent of the children were earning at least a thousand bucks more than their parents were when they were 40.

“Economic growth over the last generation has translated into income increases for many Americans,” says Erin Currier, who directs Pew’s economic mobility work.

Having a four-year degree made you more likely to exceed your parents’ income, according to the study. And African-Americans tended to be less likely to out-earn their forebears.

The economic mobility study also looked at wealth, finding that about half of Americans had banked at least $5,000 more than their parents had at the same age.

But there’s also bad news in this story. The Pew study only looked at absolute dollar gains in income and wealth. It did not look at where people stand on the economic ladder, or how that compares with their parents, Currier says.

“Sometimes you can see these big gains — what look to be big gains,” she says. “But they don’t necessarily help a person escape the economic place in which they began.”

If you’re earning $1,000 more than your parents, but your parents only earned $15,000 a year, that’s not going to escalate you into the middle class — what we call social mobility.

Another factor: The Pew study looked at entire households. These days, it often takes two incomes to surpass the one salary that was enough for the younger generation’s parents. While 93 percent of dual-earner families made at least $1,000 more than their parents, 77 percent of single-earner families did so.

Gregory Clark, an economics professor at the University of California, Davis, who studies social mobility, says he doesn’t think people care about how much more they’re earning than their parents. What matters, he says, is where your income ranks compared with other people in society.

“We can keep on producing statistics,” he says, “but it’s not going to give us any insight into how to change social mobility, and what the real mechanisms of social mobility are.”

But on the bright side, at least most of us aren’t earning less than our parents. [Copyright 2013 NPR]

Leave a Reply

7PM to 8PM Folk Salad

Folk Salad

Folk Salad Hosts Richard Higgs and Scott Aycock play an eclectic mix of Folk, Singer/songwriter, Americana, Bluegrass, Blues, Red Dirt, and anything else we happen to like that week.

Listen Live Now!

8PM to 9PM For the Sake of the Song

For the Sake of the Song

Greg Johnson, owner of The Blue Door in Oklahoma City gathers the best Red Dirt musicians in the region for his show.

View the program guide!

9PM to 12AM SpyLab

SpyLab

Katie Wicks is our resident international superstar DJ. She hosts SpyLab, a dance mix show on Saturday nights and co-hosts the largest weekly dance party in OKC, Robotic Wednesdays. She has had two original dance songs chart in the World Top 100 Beatport charts. She has been hired to DJ in L.A., NYC, Chicago, San Francisco, Dallas, Portugal, Spain and Costa Rica.

View the program guide!

Upcoming Events in your area (Submit your event today!)

Streaming audio and podcasts

Stream KOSU on your smartphone

Phone Streaming

SmartPhone listening options on this page are intended for many iPhones, Blackberries, etc. with low-cost software applications available to listen to our full-time web streams, both News on KOSU-1 and Classical on KOSU-2.

Learn more about our complete range of streaming services

We're perfecting the patient experience - Stillwater Medical Center