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Wealth gap

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Quick Hit
by Ellyn Fortino
5:43pm
Wed Jan 28, 2015

Study: Top 1% Of Earners In Illinois Captured 97% Of Post-Recession Income Gains

The top 1 percent in Illinois took home nearly all of the state's income gains in the first few years of the U.S. economy's recovery from the Great Recession.

That's one of the findings of a new study on income inequality published by the Economic Policy Institute, a nonpartisan think tank based in Washington, D.C. The report was co-authored by Estelle Sommeiller, a socioeconomist at the Institute for Research in Economic and Social Sciences in France, and Mark Price, an economist at the Keystone Research Center in Harrisburg, Pennsylvania.

Overall, the study showed that the wealthiest 1 percent of taxpayers in 39 states, including Illinois, captured at least half of all the post-recession income gains in their respective states between 2009 to 2012. Over this time period, 17 states saw their top 1 percent of earners gain 100 percent of the income growth, according to the researchers, who examined state-level tax data from the Internal Revenue Service.

Average incomes grew faster from 2009 to 2012 for those in the top 1 percent than the bottom 99 percent in every state but West Virginia, the report reads. And in 2012, the wealthiest 1 percent of Americans earned almost 30 times the income of those in the bottom 99 percent.

Quick Hit
by Ellyn Fortino
3:26pm
Fri Apr 4, 2014

Report: Credit Score Disparities Contribute To Racial Wealth Gap In Illinois

Residents in predominantly minority communities in Illinois have lower credit scores on average than those in mostly white neighborhoods — and that is a significant contributor to the racial wealth gap, according to a recent report from the Illinois Asset Building Group and the Social IMPACT Research Center at the Heartland Alliance, a Midwest anti-poverty organization.

The credit score gap between white and minority communities fuels racial inequality in the state, the "Trapped by Credit" report concludes.

In general, the report found that communities of color in Illinois are less likely than mostly white neighborhoods to have well-being indicators associated with stronger credit scores, such as higher levels of educational attainment and greater rates of homeownership and employment.

Similarly, communities of color have on average lower levels of "good debt" from student or home loans and higher levels of "bad debt" from sources like credit cards.

Since good credit scores help people gain access to better jobs, homeownership and higher education, "a cycle emerges where low credit scores feed decreased financial and social opportunity, which in turn feeds low credit scores," the report reads.

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