US wealth gap dramatically widens

The gap between the richest and poorest in the US has widened dramatically since the late 1980s, while the incomes of the least well-off have fallen since the start of the decade, according to a report out on Wednesday .

The nation's wealthiest 5 per cent of families were paid, on average, more than 12 times as much as the poorest fifth in 2004-2006, compared with nearly nine times as much in 1987-1989. During the period, the richest fifth of families added more to their income in each year than the poorest fifth did over the entire period, the study by the Economic Policy Institute and Center on Budget and Policy Priorities shows.

But the poorest people in the US were not the only ones to feel the pinch of increased inequality. The report, which studied changes in income after accounting for federal tax and inflation, found that those in the middle also saw their wages grow slowly compared with the better-off.