Income and Wages

"Income Gap" Traced To Two-Earner Families

By and large, families that get rich together, work together -- according to recent research. And the increase in two-earner families may help explain the so-called "income gap."

According to a Labor Department report last year:

  • About 30 percent of two-earner households were in the top fifth of America's income distribution in 1993 -- while only 14 percent made it to the top among households in which only the husband worked.

  • Some 15 percent of households headed by a single, working man made it to the top quintile compared to 6 percent of households headed by a single, working woman.

  • Families headed by married couples have seen bigger wage gains than single-headed families in recent decades -- due in great part, economists say, to the growth of unmarried mothers on welfare.

  • The average person living in a two-income household saw his or her income increase 44 percent between 1969 and 1993 -- to $40,213.

By contrast, most households headed by a single parent saw a drop in income. The steepest drop came in households headed by a woman who was not working, where income dropped 11 percent to $9,290 in 1993.

According to a study from the National Bureau of Economic Research, from 1969 to 1989 the time worked by married males declined slightly and earnings increased slightly. But the time worked by wives increased from 39 percent to 66 percent of the year and their earnings more than doubled.

Source: Laura M. Litvan, "How Families With Two Incomes Are Changing the U.S. Economy," Investor's Business Daily, August 22, 1996.

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