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Income Equality Rallied in 62 of 100 Largest Metros as Pandemic Was Underway — Metros Where It Improved, Worsened the Most

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Despite the destructive impact the COVID-19 pandemic has had on the economy, the latest MagnifyMoney study reveals one silver lining: Income equality improved across the majority of the 100 largest U.S. metros. According to LendingTree senior economist Jacob Channel, it’s likely due to the pandemic.

“Two of the biggest factors that positively impacted income equality in the U.S. were the government stimulus programs and the changes to the labor market,” Channel says. “The government had a very robust response to COVID-19. Outside of the direct government intervention, shifts in the labor market helped push up wages for many people.”

MagnifyMoney researchers analyzed U.S. Census Bureau Gini coefficient data to show where income equality improved — or worsened — between 2019 and 2020 in the 100 largest metros. In addition to reviewing our findings, stick around for tips on building wealth.

Key findings

  • In the majority of the 100 largest U.S. metros, income equality improved from 2019 to 2020. The Gini coefficient — which measures income equality (and inequality) — rallied in 62 of the 100 metros in the period examined.
  • Boise, Idaho, saw the biggest improvement in income equality. Its Gini coefficient decreased by 0.0096 between 2019 and 2020. (More on this soon, but a Gini coefficient of 0 represents that everyone in a metro has the same income. That means a decrease moves the needle toward equality.) However, the median household income in Boise is still 5.7 times lower than that among the top 5% of earners. Boise households earn a median of $64,717, versus $370,815 among the top earners.
  • Metros in the South saw the biggest decrease in income equality. The five metros where income equality shrunk the most are in the South. The Gini coefficient increased by 0.0133 in Richmond, Va. — the most of any metro.
  • Inequality remains prevalent in some of the metros with significant progress. For example, New York ranked 13th for the biggest income equality improvements between 2019 and 2020, but it has the fourth-highest income gap between median households and the top 5% of earners in the 100 metros examined. In New York, households earn a median of $81,951 a year, versus $603,922 a year among the top 5%.
  • Ogden, Utah, has the narrowest income gap among the 100 metros examined. The median household income in Ogden is $78,680, while the top 5% in Ogden make a median of $341,117. That means the top earners make 4.3 times more than the median household — making Ogden the only metro where the top 5% make less than 5 times more than the median earner. This is a sign that even the metro with the best income equality has a lot of room for growth.

What is the Gini coefficient?

The Gini coefficient measures how income is distributed across a population, often as a gauge of inequality. The coefficient ranges from 0 to 1. A coefficient of 1 represents perfect inequality, meaning that all income goes to one person. A coefficient of 0 represents perfect equality, meaning everyone has the same income. In other words, a higher Gini index indicates greater inequality.

MagnifyMoney researchers ranked the 100 metros by how much their Gini coefficients changed between 2019 and 2020. It’s important to note that a big improvement in a metro’s Gini coefficient doesn’t mean everything is equal, with different metros starting at different levels.

In majority of largest metros, income equality improved between 2019 and 2020

Despite the COVID-19 pandemic’s devastating impact on the U.S. economy, the newest MagnifyMoney study indicates that income equality rallied in 62 of the 100 largest metros between 2019 and 2020. This is particularly notable because the income gap has been steadily growing since the 1970s. Generally, that’s been more evident in urban areas like large metros, where income inequality has historically been higher than in rural America.

However, just as the pandemic disrupted the U.S. economy, Channel believes it may have contributed to widespread income equality improvements in two major ways: government and labor.

“Not only were there three rounds of economic impact payments sent out to households, but extra unemployment benefits guaranteed by the government also meant that, for the most part, even those who lost their jobs still brought in enough money to make ends meet,” he says. “In many instances, those on unemployment during the height of the pandemic were making more money than they were at their jobs.”

Meanwhile, the economy’s quick rebound after a wave of layoffs left businesses struggling to fill job openings, particularly as so few former employees were willing to return to work. Wages subsequently climbed as unemployment continued to drop. With lower-wage workers holding more leverage, many Americans could find better jobs — a shift likely felt among consumers, according to Channel.

“While inflation has unfortunately eaten away at many of these wage gains, the labor market still remains relatively strong,” he says. “And because the labor force participation rate — or the share of people who have or are actively looking for a job — is still depressed, employees still need to compete for a limited supply of workers, and those who have jobs have been able to keep some of their wage increases.”

Income equality improved the most in Boise, Idaho

Of the 62 metros that saw their income equality improve between 2019 and 2020, Boise, Idaho, ranked highest, with its Gini coefficient decreasing by 0.0096. As a reminder, decreases in the Gini coefficient mean a metro’s rating is getting closer to 0, indicating perfect equality. Put another way, a reduction in the Gini coefficient is good for equality.

Here’s a look at the metros with the largest equality growth between 2019 and 2020:

5 metros where income equality improved the most between 2019 and 2020
RankMetro2019 Gini coefficient2020 Gini coefficientChange
1Boise, ID0.45360.4440-0.0096
2Des Moines, IA0.43770.4307-0.0070
3Austin, TX0.46020.4535-0.0067
4Winston-Salem, NC0.47530.4687-0.0066
5Albuquerque, NM0.46700.4606-0.0064
Source: MagnifyMoney analysis of U.S. Census Bureau data

Despite the improvement in Boise, there’s still a significant equality gap. The median household income in Boise is $64,717, while the top 5% earn a median of $370,815 — 5.7 times higher. When ranking metros by the gap between these two figures, Boise is tied for 31st.

Notably, Des Moines, Iowa, the metro with the second-largest improvement in income equality, ranks among the 10 metros with the best equality outlook. The median household salary in Des Moines is $71,734, while the top 5% earn a median of $370,946 — giving it the seventh-smallest gap between the two.

Income equality decreased the most in Southern metros

The five metros where income equality worsened the most are in the South, with Richmond, Va., ranking highest. Between 2019 and 2020, the Gini coefficient in Richmond grew by 0.0133, meaning the income gap widened. Additionally, Richmond is among the top 20 metros with the largest income gap. The median household earns $71,223 a year, while the top 5% earn a median of $469,942 a year — 6.6 times more.

Take a look at how the worst-ranked metros compare:

5 metros where income equality worsened the most between 2019 and 2020
RankMetro2019 Gini coefficient2020 Gini coefficientChange
1Richmond, VA0.45970.47300.0133
2North Port, FL0.47700.48950.0125
3Charleston, SC0.47360.48040.0068
3Greenville, SC0.46700.47380.0068
5Jackson, MS0.47280.47950.0067
Source: MagnifyMoney analysis of U.S. Census Bureau data

One possible explanation for this could be because Southern states generally had fewer policies to protect employees from the impacts of COVID-19, particularly in the early days of the pandemic. Therefore, Southerners with low incomes were likely more vulnerable to the long-term impacts of lost wages than those who lived in metros with more statewide protections.

Virginia, for example, was among the states that enacted the fewest laws and policies to protect its unemployed population between Feb. 15, 2020, and July 1, 2020 — a period in which the coronavirus began spreading quickly across the U.S — according to an Oxfam America study. Notably, according to the study, Virginia didn’t pass legislation preventing employers from forcing sick workers to return to work or retaliating against employees who caught the coronavirus. It also didn’t enact any statewide personal protective equipment (PPE) requirements, putting employees at an increased risk of illness.

Similarly, Florida, South Carolina and Mississippi passed minimal legislation to protect workers during the same time frame, according to Oxfam America, with none preventing employers from forcing workers to return to work after an illness. Of these three, Florida was the only state that protected employees from workplace retaliation and placed a statewide moratorium on evictions (in addition to the federal moratorium).

In addition to a lackluster response to the pandemic, Channel also attributes the South’s historical struggle with income inequality and poverty to its widening income gap.

“Generally, Southern states have more lax labor laws, meaning that it’s sometimes easier for companies to take advantage of employees,” Channel says. “The so-called pro-business mentality that many Southern states adopt can make it much harder for workers to negotiate raises or take actions that could help ease income inequality. Beyond that, the long-term legacies of policies like the Jim Crow laws and redlining also hurt many Southerners — namely those from communities of color — and doubtlessly exacerbates inequality.”

Full rankings

Metros where income equality improved the most
RankMetro2019 Gini coefficient2020 Gini coefficientChange
1Boise, ID0.45360.4440-0.0096
2Des Moines, IA0.43770.4307-0.0070
3Austin, TX0.46020.4535-0.0067
4Winston-Salem, NC0.47530.4687-0.0066
5Albuquerque, NM0.46700.4606-0.0064
6Orlando, FL0.46710.4611-0.0060
7Indianapolis, IN0.47080.4659-0.0049
8Knoxville, TN0.47560.4709-0.0047
9Dallas, TX0.46710.4628-0.0043
10Columbus, OH0.45760.4534-0.0042
11Pittsburgh, PA0.46960.4660-0.0036
11Tucson, AZ0.46940.4658-0.0036
13Dayton, OH0.45950.4562-0.0033
13New York, NY0.51520.5119-0.0033
15Louisville, KY0.46270.4596-0.0031
16Grand Rapids, MI0.44270.4397-0.0030
16Ogden, UT0.39220.3892-0.0030
16Augusta, GA0.46250.4595-0.0030
19McAllen, TX0.48670.4838-0.0029
19Syracuse, NY0.45740.4545-0.0029
21Oklahoma City, OK0.46710.4644-0.0027
21Kansas City, MO0.45430.4516-0.0027
23Chicago, IL0.48350.4811-0.0024
24Philadelphia, PA0.48470.4824-0.0023
24St. Louis, MO0.46620.4639-0.0023
26Providence, RI0.4660.4638-0.0022
27Stockton, CA0.45290.4508-0.0021
27Cape Coral, FL0.47980.4777-0.0021
29Miami, FL0.51350.5115-0.0020
29Denver, CO0.45100.4490-0.0020
29Portland, OR0.44640.4444-0.0020
32Detroit, MI0.47680.4749-0.0019
32Bridgeport, CT0.54220.5403-0.0019
32Greensboro, NC0.47470.4728-0.0019
32Jacksonville, FL0.46690.4650-0.0019
36Salt Lake City, UT0.42970.4279-0.0018
36Los Angeles, CA0.49450.4927-0.0018
36Baton Rouge, LA0.47940.4776-0.0018
39New Orleans, LA0.50030.4986-0.0017
40Houston, TX0.48550.4840-0.0015
40Sacramento, CA0.45970.4582-0.0015
40Worcester, MA0.45230.4508-0.0015
40Madison, WI0.43910.4376-0.0015
44San Francisco, CA0.48560.4842-0.0014
45Durham, NC0.48430.4831-0.0012
46San Diego, CA0.46270.4616-0.0011
47San Jose, CA0.46650.4656-0.0009
48Baltimore, MD0.45700.4562-0.0008
49Nashville, TN0.46350.4628-0.0007
49Provo, UT0.41840.4177-0.0007
51Riverside, CA0.44880.4483-0.0005
51Minneapolis, MN0.44520.4447-0.0005
51Omaha, NE0.44510.4446-0.0005
51Toledo, OH0.47090.4704-0.0005
51Harrisburg, PA0.43630.4358-0.0005
56Albany NY0.44050.4401-0.0004
56Akron, OH0.46930.4689-0.0004
56Spokane, WA0.45390.4535-0.0004
59Honolulu, HI0.43360.4333-0.0003
59Little Rock, AR0.47640.4761-0.0003
61Phoenix, AZ0.46190.4617-0.0002
62Atlanta, GA0.47090.4708-0.0001
63Cleveland, OH0.48530.48530.0000
64Boston, MA0.47930.47950.0002
65Hartford, CT0.46440.46470.0003
66Las Vegas, NV0.46710.46760.0005
66Milwaukee, WI0.47620.47670.0005
66Bakersfield, CA0.46680.46730.0005
66Columbia, SC0.46420.46470.0005
70Deltona, FL0.45570.45640.0007
71San Antonio, TX0.46360.46440.0008
72Rochester, NY0.45680.45770.0009
73Oxnard, CA0.44550.44650.0010
74Raleigh, NC0.44590.44700.0011
74Seattle, WA0.45380.45490.0011
76Tampa, FL0.47560.47680.0012
76Springfield, MA0.46800.46920.0012
76Cincinnati, OH0.46540.46660.0012
79Charlotte, NC0.47400.47530.0013
80Washington, DC0.44390.44540.0015
80Buffalo, NY0.46210.46360.0015
82Memphis, TN0.49180.49340.0016
83Birmingham, AL0.48280.48480.0020
84Allentown, PA0.44400.44610.0021
85Tulsa, OK0.47080.47300.0022
86Colorado Springs, CO0.43140.43380.0024
87New Haven, CT0.46910.47180.0027
88Palm Bay, FL0.45050.45340.0029
89Fresno, CA0.47460.47760.0030
89Wichita, KS0.44500.44800.0030
91Virginia Beach, VA0.43940.44260.0032
92Chattanooga, TN0.47100.47590.0049
93El Paso, TX0.46150.46690.0054
94Lakeland, FL0.44520.45130.0061
95Poughkeepsie, NY0.44510.45160.0065
96Jackson, MS0.47280.47950.0067
97Greenville, SC0.46700.47380.0068
97Charleston, SC0.47360.48040.0068
99North Port, FL0.47700.48950.0125
100Richmond, VA0.45970.47300.0133
Source: MagnifyMoney analysis of U.S. Census Bureau data. Note: A negative change indicates that income equality improved (equality got closer to 0), while a positive change shows that income equality worsened.

Inequality remains prevalent in some metros with significant progress

While some metros have made significant progress in closing the income gap, inequality is still prevalent. New York City, for example, ranked in the top 15 for where income equality improved the most, but it remains one of the metros with the highest income gaps. In New York, the median household earns $81,951 a year, while the top 5% earn a median of $603,922 a year — the fourth-highest gap between the two data points.

Six of the 10 metros with the highest income gap between median households and top earners saw their equality improve between 2019 and 2020. That includes Bridgeport, Conn., the metro that ranks highest for income inequality. In Bridgeport, the top 5% earn 9.1 times what the median earners take home annually ($97,539 versus $883,321). Despite its wide income gap, however, Bridgeport’s Gini coefficient shrank by 0.0019 between 2019 and 2020. Some of the additional metros with the highest gaps that saw their Gini coefficients shrink include:

  • Miami, where the median household earns $59,030 and the top 5% earns $472,715, saw its Gini coefficient shrink by 0.0020.
  • Cape Coral, Fla., where the median household earns $59,608 and the top 5% earns $417,622, saw its Gini coefficient shrink by 0.0021.
  • New Orleans, where the median household earns $54,388 and the top 5% earns $375,918, saw its Gini coefficient shrink by 0.0017.
  • Los Angeles, where the median household earns $76,399 and the top 5% earns $521,348, saw its Gini coefficient shrink by 0.0018.

That leaves four of the 10 metros with the highest income gap where equality worsened. Notably, North Port, Fla., the metro with the third widest-growing income gap, ranked second for worsening income inequality.

Full rankings

Metros with the biggest gap between median earners, top 5% of earners
RankMetroMedian household incomeTop 5% incomeIncome gap between median households and top 5%2020 Gini coefficient
1Bridgeport, CT$97,539$883,3219.1 times0.5403
2Miami, FL$59,030$472,7158.00.5115
3North Port, FL$62,438$483,6587.70.4895
4New York, NY$81,951$603,9227.40.5119
5Cape Coral, FL$59,608$417,6227.00.4777
5Memphis, TN$53,896$376,3807.00.4934
7New Orleans, LA$54,388$375,9186.90.4986
8Los Angeles, CA$76,399$521,3486.80.4927
9Charleston, SC$65,894$442,7526.70.4804
9Chattanooga, TN$54,425$365,2906.70.4759
9Houston, TX$69,328$464,7746.70.4840
12Durham, NC$64,745$430,2746.60.4831
12Cleveland, OH$57,263$380,3926.60.4853
12Birmingham, AL$59,185$392,6136.60.4848
12Charlotte, NC$65,725$434,7216.60.4753
12Tampa, FL$57,097$376,7686.60.4768
12Richmond, VA$71,223$469,9426.60.4730
12Tulsa, OK$57,341$376,8616.60.4730
19Greenville, SC$57,432$373,2886.50.4738
19Chicago, IL$74,621$482,0536.50.4811
21Milwaukee, WI$63,739$410,9016.40.4767
21Greensboro, NC$52,233$336,7266.40.4728
21Little Rock, AR$55,983$360,2916.40.4761
21Jackson, MS$53,639$343,0396.40.4795
21Nashville, TN$68,406$436,0656.40.4628
21Knoxville, TN$56,857$362,4316.40.4709
27Winston-Salem, NC$52,607$333,9656.30.4687
27Atlanta, GA$71,193$450,3096.30.4708
27Las Vegas, NV$61,048$385,9796.30.4676
27San Francisco, CA$110,837$699,5676.30.4842
27Philadelphia, PA$74,825$470,6876.30.4824
27Jacksonville, FL$63,064$394,8676.30.4650
27McAllen, TX$41,846$261,5426.30.4838
34Baton Rouge, LA$60,043$373,7046.20.4776
34Indianapolis, IN$63,545$394,7406.20.4659
34Akron, OH$59,313$367,9616.20.4689
34Phoenix, AZ$67,068$415,6766.20.4617
34Orlando, FL$61,229$377,3386.20.4611
39Fresno, CA$57,109$351,3276.20.4776
40Dallas, TX$72,882$447,9936.10.4628
40Detroit, MI$62,768$385,4726.10.4749
40Oklahoma City, OK$60,476$371,3316.10.4644
40Boston, MA$93,537$571,9256.10.4795
40St. Louis, MO$65,725$400,5216.10.4639
40Toledo, OH$53,600$324,8286.10.4704
46Louisville, KY$60,891$367,4346.00.4596
46Cincinnati, OH$66,435$399,8856.00.4666
46Tucson, AZ$55,023$330,0596.00.4658
46Deltona, FL$53,339$319,3016.00.4564
46San Antonio, TX$61,437$366,8276.00.4644
51Pittsburgh, PA$61,969$368,7035.90.4660
51Lakeland, FL$51,535$304,0165.90.4513
51New Haven, CT$71,370$420,8735.90.4718
51Bakersfield, CA$54,851$321,6155.90.4673
55Columbia, SC$56,680$329,7355.80.4647
55El Paso, TX$48,193$280,0825.80.4669
55San Diego, CA$82,426$477,5495.80.4616
55Seattle, WA$90,790$525,2845.80.4549
55Austin, TX$80,852$466,4325.80.4535
55Palm Bay, FL$59,359$341,9775.80.4534
61Denver, CO$83,289$478,4065.70.4490
61Spokane, WA$59,656$341,9735.70.4535
61Boise, ID$64,717$370,8155.70.4440
61Springfield, MA$61,360$351,0525.70.4692
61Rochester, NY$61,747$352,7675.70.4577
61Kansas City, MO$69,240$394,8565.70.4516
61Hartford, CT$78,631$447,0365.70.4647
61San Jose, CA$129,343$733,8315.70.4656
61Buffalo, NY$59,079$334,4395.70.4636
61Columbus, OH$66,715$377,4515.70.4534
71Grand Rapids, MI$66,297$370,8255.60.4397
71Providence, RI$70,676$395,1845.60.4638
71Albuquerque, NM$55,370$308,8285.60.4606
71Minneapolis, MN$82,887$460,1955.60.4447
75Omaha, NE$69,439$385,1605.50.4446
75Sacramento, CA$75,533$417,7235.50.4582
75Dayton, OH$57,631$318,4735.50.4562
75Raleigh, NC$78,706$432,6845.50.4470
75Syracuse, NY$61,890$339,6445.50.4545
75Wichita, KS$58,333$319,6575.50.4480
75Virginia Beach, VA$68,454$374,5265.50.4426
75Oxnard, CA$89,295$488,2385.50.4465
75Allentown, PA$69,769$380,7345.50.4461
84Baltimore, MD$83,811$456,4065.40.4562
84Augusta, GA$55,049$298,8485.40.4595
84Washington, DC$106,415$574,5025.40.4454
84Portland, OR$77,511$417,8985.40.4444
84Stockton, CA$68,628$368,7655.40.4508
89Madison, WI$73,807$393,7885.30.4376
89Salt Lake City, UT$77,102$410,4005.30.4279
89Harrisburg, PA$67,219$357,3415.30.4358
89Poughkeepsie, NY$81,331$430,4555.30.4516
89Riverside, CA$68,331$359,8435.30.4483
94Des Moines, IA$71,734$370,9465.20.4307
95Worcester, MA$75,705$387,7075.10.4508
95Albany, NY$72,810$372,4385.10.4401
95Colorado Springs, CO$71,171$363,0265.10.4338
95Provo, UT$76,864$388,3225.10.4177
99Honolulu, HI$87,722$437,8755.00.4333
100Ogden, UT$78,680$341,1174.30.3892
Source: MagnifyMoney analysis of U.S. Census Bureau data.

Ogden, Utah, has the smallest income gap

Across all metros analyzed, Ogden, Utah, has the smallest income gap between median earners and the top 5% of earners. The top 5% in Ogden make 4.3 times what the median household makes — $341,117 versus $88,680. While that’s a considerably higher income, it’s the only metro where the top 5% earns less than five times what the median earner makes.

Following that, Honolulu has the second lowest income gap. The median household earns $87,722, while the top 5% bring in a median of $437,875 — 5.0 times more. Some of the other highlights, each with differences of 5.1, include:

  • Provo, Utah: The median household earns $76,864, while the top 5% earn $388,322
  • Colorado Springs: The median household earns $71,171, while the top 5% earn $363,026
  • Albany, N.Y.: The median household earns $72,810, while the top 5% earn $372,438

Tips to increase your income

While the shrinking income gap is generally good news for consumers, Channel says it’s important to note that recent economic changes could potentially impact the income gap.

“High inflation and aggressive action from the Federal Reserve means the probability of a recession is high — if we’re not in one already,” Channel says. “If or when the labor market finally does cool and the impacts of the recession become more noticeable, it’s likely that lower income workers will be hardest hit and, as a result, income and wealth inequality could very well grow again.”

While consumers can’t control income inequality, they can take some steps to increase their income level. Specifically, Channel recommends the following:

  • Learn how to negotiate. “One of the best ways to increase your earnings is to know your worth and negotiate with your employer,” Channel says. “Talk about what you specifically bring to the table. The more you’re able to prove your invaluableness, the better your chances of being able to negotiate a raise. Remember that without employees, no company could survive and as a result, you should always be willing to fight to get what you’re worth from your employer.”
  • Consider investing extra cash in a high-yield savings account. “With rates rising so dramatically and the stock market behaving so erratically, now can be a good time to park your money in a low-risk savings account,” Channel says. Alternatively, he suggests exploring other low-risk investments such as government-backed bonds.

Methodology

To rank the states where income equality is improving the most, MagnifyMoney researchers analyzed U.S. Census Bureau American Community Survey data to explore the change in the Gini coefficient between 2019 and 2020. The Gini coefficient is a measure of income inequality. The coefficient ranges from 0 to 1. A coefficient of 1 represents perfect inequality, meaning that all income goes to one person. A coefficient of 0 represents perfect equality, meaning everyone has the same income.

Researchers ranked metros based on this change. We also ranked metros according to the difference between the median income and income needed to be considered in the top 5%.