CLEVELAND, Ohio — Do you know what your net worth is? Consider everything you own: your house, cars, savings — and subtract everything you "owe" — your debts.

What You Need To Know


  • The Brookings Institute in 2016 reported that the average Black household has about $17,000 of net worth compared to the average white household having $171,000 of net worth

  • The wealth gap between white people and Black people is roughly the same now as it was over 60 years ago, according to a study done by economists at the Federal Reserve Bank of Cleveland

  • Many factors contribute to the wealth gap, including discriminatory policies involving housing, education, incarceration, and the workplace, according to Randell McShepard, co-founder of PolicyBridge, an African American-led public policy think tank in Cleveland

According to the Brookings Institute, a nonprofit public policy research organization, the net worth of the average Black household in the United States is drastically lower than that of the average white household.

“The Brookings Institute in 2016 reported that the average African American household is about $17,000 of net worth, compared to the average white household having $171,000 of net worth,” said Randell McShepard, co-founder of PolicyBridge, a non-partisan, African American-led public policy think tank based in Cleveland.

And that's the basis of what is known as the Black-white wealth gap.

McShepard said there are many reasons for the gap, including discriminatory policies involving housing, education, incarceration, and the workplace. He explained that all of those issues affect opportunities — everything from where a person is able to live to the quality of education — which determines the ability to find jobs with good salaries and income security.

“Blacks just typically are not paid at the same level as whites. Even with the superior education on average, they are not being compensated at the same level,” said McShepard. “So, what, what more can a person do then, you know, get a college degree or master's or Ph.D., and then realize that on average, you're still going to make less than a white person that dropped out of high school, I mean that tells you a lot.”

“If you're thinking about policy to try to correct the racial wealth gap, that there's a lot of policies that are out there, but any policy that doesn't in some way address or work in tandem with efforts to reduce that, that earnings gap as well, are going to be short-lived in their efficacy,” said Daniel Carroll, senior research economist at the Federal Reserve Bank of Cleveland.

Carroll completed a study on the Black-white wealth gap. He points to the way Black people are viewed by society, in general, as a cause in limiting access to greater opportunities.

“Their, their impressions are, I think false impressions, you know, they get from whatever they're seeing right on TV or, or, or hearing. And they're not really sort of meeting with everyday people,” Carroll said. “And so it's easy to sort of, if that's the only picture you're getting, it's easy to dismiss these problems as, as someone else's issue.”

McShepard said a staggering realization is that the wealth gap between white people and Black people is roughly the same now as it was over 60 years ago.

“That​ says that decades are passing by and it doesn't seem to bother those lawmakers and other civic leaders, policy makers that could be thinking about this or doing something about it,” McShepard said.

McShepard said one of the best ways to begin to bridge the wealth gap is to recognize that there is a gap and that Black people didn’t create it themselves.

“The saddest moments for me have been when people say, you know, Black people, they're lazy, they just aren't trying hard enough, then oh, what are they whining about? You know, I had to do all these things to start my business, or I had to do this and that doesn't take into account that you know, if this was a race, you know, you started a hundred yards ahead of a person of color in terms of just not having so much ground to make up. So the wealth gap really is about making up lost ground,” said McShepard.