A paper titled “INCOME MOBILITY IN THE U.S. FROM 1996 TO 2005” published by the Department of the Treasury this past November was recently discussed in this week’s Barron’s in an article titled “Two Americas, or One“.
One thing that has occurred to me as I’ve read any discussion of income distribution (e.g. the top 1% of earners make X% of income) is whether those people stay at the same levels, the rich getter richer, or whether people move around much. This study helped to answer that question a bit.
Above, is table one from the study. Simply put, of the lowest quintile (1/5) of the wage earners, nearly 58% moved up in income ranking, and 5.3% moved right up to the highest quintile. In a similar fashion, 31% of those in the highest quintile to start, dropped out. You can study this chart to come to your own conclusion, or you may read either of the articles linked above.