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Progress and Inequality: Observations and Conclusions The findings in this report are cause for both celebration and caution. Numerically, Hispanic middle class households are a new force in the demography and economy of the United States. The celebration is in the clear gains in upward mobility for a wide range of Hispanic households. Those gains are greatest in selected regions. The gains are considerable in Texas and modest or non-existent in the New York-New Jersey region. At the same time, there appears to be a slowing in the rate at which younger cohorts are able to become members of the middle class. While there is considerable upward mobility, it is not as great for some younger cohorts, or in New York-New Jersey. The Hispanic groups in New York- New Jersey are quite unlikely to move upward in the same way as Hispanics in Texas and Florida. It is useful to review the research in the context of income inequality which was raised at the beginning of the study. A useful measure of inequality is the ratio of the lowest income quartile to the highest income quartile, the 75/25 ratio, and changes in that ratio over time. Using that ratio, Reed (1999) shows that income inequality has been increasing in the United States and even more dramatically in California since about 1980. In 1969, in California, the upper middle class (the 75th percentile) had about 2.3 times more income than the lower middle class (the 25th percentile) and this ratio increased to nearly 3.3 times in 1998 (Figure 13). Reed attributes the increase in income inequality to the fact that there are increasing wage differentials between skilled and less-skilled workers. In turn the increase in wage differentials leads to an increasing bifurcation in incomes. In California at least, those with more education are earning higher incomes and increasing the differential between those with more education and those with less than a high school diploma.
The increase in inequality in California and the distributions of household income suggest that there is a potential if not existing bifurcation in the income distribution. If there is both upward mobility for some and stagnation or decline for others, the pattern of inequality may increase over time. Are there in fact trajectories of promise and trajectories of despair for Hispanic households? Computing the 75th/25th income ratio for Hispanic households in the United States and by states suggests that Hispanic households may be following the paths already in place for the population as a whole (Table 9). Inequality ratios have increased for Hispanic households for the United States as a whole and in three of the four regions in the analysis. They declined very slightly in Texas for all Hispanic households but increased for native-born households. Florida also had a small decrease in the inequality ratio for the native-born population. An additional significant finding is that the inequality ratios are higher for Hispanic households in New York than they are for the total population. They are also higher in Florida. These inequality ratios are evidence of a bifurcating Hispanic population, one that is following the same paths already carved out by the population as a whole. The long-term implications suggest that the paths of success may well be paralleled by paths of limited opportunities.
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