Denver - The rich and poor gap difference in annual income between
households in the top 20 percent and those in the bottom 20 percent ballooned
by $29 200 to $189 600 between 2010 and 2015, based on Bloomberg
calculations using US Census Bureau data.
Computers and robots are taking over many types of tasks,
shoving aside some workers while boosting the productivity of specialised
employees, contributing to the gap.
“Technological developments have increasingly replaced low-
and mid-skilled jobs while complementing higher-skilled jobs,” said Chad
Sparber, an associate professor and chair of the economic department at Colgate University.
This shift is predicted to continue. About 38 percent of US
jobs could be at high risk of automation by the early 2030s, according to a
study by PricewaterhouseCoopers. The “most-exposed” industries include
retail and wholesale trade, transportation and storage, and manufacturing, with
less-educated workers facing the biggest challenges.
Companies’ use of temporary and part-time employees to cut
costs also may be widening the disparity, with wage growth failing to keep up
with rising residential and basic-necessity expenses. As the divide grows,
hardships increase for the bottom 20 percent. Affordable housing, for example,
is in short supply nationwide, forcing workers to find shelter further from
their jobs and endure lengthier and costlier commutes. Rental costs rose nationally
by 3.9 percent in March from a year earlier, according to the Labour
Department.
High-tech hubs were among the five metropolitan statistical
areas where the gap between the highest- and lowest-income households expanded
the most: two in California, San Francisco and San Jose,
as well as Austin and Seattle.
The fifth is Fairfield
County in south-western Connecticut. The
majority of full-time, year-round employees in the high-income communities
there, including Old Greenwich and Darien, work in sectors such as finance,
insurance and scientific and technical services. Almost half the employees in
lower-income cities, including Bridgeport,
have jobs in retail, manufacturing, construction, administration and waste
services.
Bloomberg also calculated the change in the gap between the
super rich [the top 5 percent] and the middle class [the middle 20 percent]. It
grew by $58 800, with Grand Rapids and Des Moines among the
metro areas with the biggest changes.
Western Michigan has
benefited from investment in industries including information technology,
specialized manufacturing and life sciences, according to The Right Place, a
private, non-profit economic development organization. The Iowa metro area is a finance hub, with an
insurance sector that’s expanded more than 11 percent in the past 15 years, the
Iowa Economic Development Authority said.
Read also: LISTEN: Robots are here for your job
The gap even widened within the middle class, with the span
between lower and upper household incomes at the 30th and 80th percentiles
growing by $9 000.
“Companies are doubling down on costs cuts and streamlining
their operations,” said Chris Rupkey, chief financial economist at MUFG Union
Bank in New York.
Workers “at the bottom have not seen as much improvement as those at the very
top of society.”
BLOOMBERG