Atlanta has the highest income inequality among large U.S. cities, according to recent data from the United States Census Bureau. Driving much of Atlanta’s income inequality, experts say, is the city’s entrenched racial disparities which took root generations ago.
Even as the city continues to prosper, many Black Atlantans in particular have been left out of its economic success story of the past several years, they add. The persistent economic struggles have been exacerbated by general inflation, especially rising food and gas prices, which are hitting lower-income residents hard.
“When a very large percentage is vulnerable to that kind of economic pressure it says that we have a lot of work to do,” said Kyle Waide, president and CEO of The Atlanta Community Food Bank, which is experiencing soaring demand for services.
The city’s dubious ranking is based on a measure of income inequality, known as the Gini coefficient, used by economists and organizations across the globe. The latest Census data spans a five-year period from 2016 to 2020.
The Gini coefficient measures how equally income is distributed among a population and is expressed in a decimal format ranging from zero to one.
A score of zero represents complete income equality within a community, meaning that every person has equal income. The higher the decimal score, the greater the inequality. A coefficient of one represents the most extreme concentration of wealth at the top: one person holds all of the wealth.
Atlanta has the largest gap between the poor and wealthy among cities with more than 100,000 residents with a Gini coefficient of 0.5786, according to Census data.
By comparison, New Orleans is ranked No. 2 with a coefficient of 0.5655; New York City occupies the No. 7 spot with a coefficient of 0.5470; and Tampa comes in at No. 8 with a score of 0.5426. On the other extreme, Phoenix has a Gini coefficient score of .4710 and more equality, ranking it No. 119 on the list.
Census data going back more than a decade shows Atlanta’s high inequality has persisted through the years. Atlanta has led the nation in this dubious ranking for at least a decade.
Atlanta continues to benefit from strong economic growth, as does Georgia. The metro area has 17 of the state’s 19 Fortune 500 companies, according to the list published earlier this year. And the state continues to rank among the most attractive in the country to do business.
But many Black residents are not seeing the benefits of this success, said Janelle Williams, co-founder of the Atlanta Wealth Building Initiative. The median household income for a Black family in Atlanta is $28,000, while the median income for white families is roughly $84,000. Overall, Black residents account for half of the city’s population.
Within Atlanta, the wealth gap often can be seen in stark geographic terms. Buckhead, in the north, is majority-white and among the city’s wealthiest areas. Thomasville Heights, in southeast Atlanta, is majority Black and among the city’s poorest neighborhoods, according to Census data.
Experts point to several factors in Atlanta’s past and present that have contributed to the wealth gap, including pervasive redlining, mass incarceration, gentrification and the lack of healthcare access within Atlanta — most recently highlighted by the closure of Atlanta Medical Center this month.
“Several of those facts have not translated into new realities for Black people in this city born south of I-20,” Williams said.
Georgia Gwinnett College economics professor Jason Delaney says that the Gini index is a well-tested and widely-used metric among economists. But he notes there are some limitations.
It does not account for different cost of living standards, nor does it account for the geographic distribution of wealth, he said.
In Atlanta’s case, many middle class neighborhoods in Cobb, DeKalb and Stone Mountain are left out of the calculation.
“City boundaries are incredibly political,” Delaney said.
The Census defines metropolitan and micropolitan areas as those which are economically and socially intertwined with the population center (in this case Atlanta). Looking at this broader definition, the picture is rosier for the Atlanta metro area.
The Atlanta metro area ranks as No. 227 for income inequality, with a Gini co-efficient of 0.4708, significantly better than the New York metro area (No. 39) and the Houston metro (No. 117).
But while comparisons between cities are imperfect, so is the definition of the Atlanta metro area, which includes 29 counties stretching to Georgia’s western and northern borders.
Williams and Tene Traylor, Atlanta Wealth Building Initiative’s other co-founder, say a mix of race-neutral and race-explicit strategies, such as providing capital to Black-owned businesses, are needed to address Atlanta’s wealth gap.
“What happened in this city happened with intent. So we want to be intentional about how we address harm and black people being locked out,” Williams said. “We do it with deep love for our city.”
