The findings, which St. Louis Fed economist and one of the report’s authors William Emmons called “really quite striking to me” revealed that having a college degree does not protect Hispanic and Black families’ wealth: In fact, Black and Hispanic families with college-educated members saw a steeper decline in household wealth in turbulent economic times than those that did not have college-educated members.
“We expected college to have a positive effect for all groups,” said Emmons. But according to the study, the reverse was true for Black and Hispanic families.
“Median wealth declined by about 72 percent among Hispanic college-grad families versus a decline of only 41 percent among Hispanic families without a college degree. Among blacks, the declines were 60 percent versus 37 percent,” the study found.
Dr. Earl Smith, professor emeritus of sociology at Wake Forest University, called the study’s findings “puzzling” and challenged experts to account for why the idea of “the American Dream” has been so clearly withheld from families of color.
Emmons said there are two major areas in which disparities were evident and which presented problems for wealth security of these groups.
The first, he said, which account for short-term issues around the recession, were financial aspects ― the types of assets and liabilities that the typical family had and, specifically, exposure to the housing crash.
