The Great Recession affected Americans from all walks of life, but it took a lopsided toll on the personal wealth of blacks and Hispanics, erasing many of the gains made over the past two decades, a new report shows.
The report, released July 26 by the nonpartisan Pew Research Center, found that the median wealth of white households at the end of the recession in 2009 was 20 times that of black households and 18 times that of Hispanic households -- the biggest gap since the U.S. Census Bureau began collecting such data a quarter-century ago.
From 2005 to 2009, the analysts found, inflation-adjusted median wealth fell by 66 percent among Hispanic households and 53 percent among black households, compared with 16 percent among white households, which had far more personal wealth to start with.
By 2009, about a third of black and Hispanic households had a net worth of zero or less, compared with 15 percent of white households.
In every ethnic group, the Pew researchers found, the poorest fared worst. And among blacks who were already struggling, the recession's effect sometimes meant it was a challenge just to afford food.
"If you are a low-income person, then you don't have much in the way of resources during hard times," said Rakesh Kochhar, associate director for research at the Pew Hispanic Center and the report's main author. "If you haven't accumulated wealth over time, you're going to fall (harder)."
But he also noted that because the report relies on 2009 data -- the most recent available -- the analysts don't know yet whether the shift in wealth will be brief or lasting.
In a few states the disparities were particularly sharp for Hispanics, largely because of the uneven effect of the housing market's collapse.
While virtually all homeowners lost personal wealth as the value of their property declined, the drop for Hispanic homeowners was greatest in terms of both equity and homeownership.
For Luis Raúl Arroyo, 50, a Kissimmee businessman and father of three who moved from Puerto Rico for a better life, the homeownership dream turned into a nightmare. On the cusp of the recession, he lost his job at Walmart, then his wife had her hours cut at Walt Disney World. Soon, the family had burned through their savings, lost their $225,000 home in Poinciana and spent nearly four months sleeping in their car.
"Since I am a professional, it has been very difficult to find a job because all the places where I applied told me I was overqualified," said Arroyo, who has a bachelor's degree in business administration. "You do not see the same treatment for Hispanics as for the (non-Hispanic) Americans. We knock at many doors, and they do not open for us."