As federal tax changes appear imminent, income inequality has come under the spotlight – and justifiably so. While there is much debate around which policies will bolster the working and middle class, most would recognize that income inequality has been on the rise in recent decades.
Though many measures of income inequality exist, an often cited measurement is the Gini Index, a popular metric used by economists, governments, and NGOs. According to the U.S. Census Bureau, the Gini Index, also known as the Gini Coefficient, describes “the dispersion of income across the entire income distribution,” or how income is distributed among people in a group such as a city or a country. The Gini Index ranges from 0, which indicates perfect income equality (everyone receives the same wage), to 100, in which one person receives all the group’s income.
While big cities typically score worse on the Gini Index than suburban or rural areas, researchers at ConsumersAdvocate.org decided to see which cities with populations over 500k fared the best.
cities with the highest income equality
Methodology:
Data is from the U.S. Census Bureau’s American Community Survey 2016 release of 5-year estimates. Cities with populations under 500,000 were excluded from the list. While the Gini Index is a popular metric reported by organizations such as the World Bank, it’s important to note that it is a single metric with limitations.
For instance, cities with different income distributions may have the same Gini Index and extreme outliers may affect the score. It also doesn’t take into account the overall wealth of a location or age differences in populations, which can skew the data.
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15. Indianapolis, IN
- Gini Index: 48.42
- Median Household Income: $43,101
- Population: 846,674
Known as the “Crossroads of America” due to its six interstate highways, Indianapolis is one of the largest cities in the Midwest, second only to Chicago. Its diversified economy has robust sectors ranging from sports, to education, to tech and finance.
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14. Phoenix, AZ
- Gini Index: 48
- Median Household Income: $49,328
- Population: 1,555,324
The most populous city on this list, Phoenix is a growing hub for the tech and telecommunications sector. With new companies and industries moving in, the economy has seen an increase in job growth along with a booming housing market and rising cost of living.
Photo credit: Wikimedia
13. Milwaukee, WI
- Gini Index: 47.43
- Median Household Income: $36,801
- Population: 598,672
Another large midwestern city, Milwaukee has a population of 598,672. Though Milwaukee is one of the top manufacturing centers in the United States, its professional and managerial positions are projected to grow the most over the next several years. Milwaukee has a median household income of $36,801, the lowest on this list.
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12. San Diego, CA
- Gini Index: 47.2
- Median Household Income: $68,117
- Population: 1,374,812
Home to native Californians, transplants from other parts of the U.S., and immigrants from around the world, San Diego is celebrated for its rich cultural diversity. Manufacturing and international trade, especially in the border town of Tijuana, are major contributors to the economy.
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11. Oklahoma City, OK
- Gini Index: 47.17
- Median Household Income: $50,070
- Population: 620,015
Oklahoma City is well-known for being a major producer of natural gas and crude oil, as well as a top producer of livestock. However, Oklahoma City should be more notable for its low cost of living.
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10. Nashville, TN
- Gini Index: 47.15
- Median Household Income: $49,891
- Population: 643,771
Nashville is home to more than just country music and festivals. With rapid job growth, in part because of the increase in new business filings, Nashville (and Tennessee as a whole) is becoming an increasingly attractive place to live.
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9. Albuquerque, NM
- Gini Index: 46.87
- Median Household Income: $48,127
- Population: 556,859
The most populous city in New Mexico, Albuquerque has a diverse economy driven by high-tech companies, government defense contractors, and educational institutions.
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8. Jacksonville, FL
- Gini Index: 46.54
- Median Household Income: $48,256
- Population: 856,616
A coastal city, Jacksonville is known for its proximity to the seaport and multiple naval bases. Not surprisingly, defense and transportation are two main contributors to the economy, as well as tourism.
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7. El Paso, TX
- Gini Index: 46.48
- Median Household Income: $43,322
- Population: 678,058
El Paso is the first of three Texas cities to make this list. Continued job growth along with strong gains in personal income suggest that the overall economy is healthy and poised to continue growing.
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6. Tucson, AZ
- Gini Index: 46.4
- Median Household Income: $37,973
- Population: 527,586
A two-hour drive from Phoenix, Tucson is the second city in Arizona to make the list. While the job market is steadily improving in Tucson, it’s still not keeping up with the rest of the state, nor is it back to pre-recession levels.
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5. San Antonio, TX
- Gini Index: 46.31
- Median Household Income: $48,183
- Population: 1,439,358
One of the more populous cities on this list, San Antonio has a median household income of $48,183 and a population of 1,439,358. Defense, healthcare, and tourism dominate the economy, while a large number of universities in the area ensure a highly-educated workforce.
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4. Las Vegas, NV
- Gini Index: 46.3
- Median Household Income: $50,882
- Population: 613,295
Despite its high ranking on this list, Las Vegas is heavily reliant on tourism and hospitality to bolster the economy, which could lead to trouble in the long run. The good news? Las Vegas is beginning to diversify by creating an economic environment friendly to new enterprises and industries.
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3. Fort Worth, TX
- Gini Index: 45.96
- Median Household Income: $54,876
- Population: 815,930
The fourth-largest metro area in the country by GDP, Fort Worth is a growing destination for job seekers and recent graduates. Manufacturing, utilities, and tourism are particularly large sectors, though the economy is beginning to diversify more and more.
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2. San Jose, CA
- Gini Index: 45.04
- Median Household Income: $90,303
- Population: 1,009,363
San Jose has a population of 1,374,812 and a median household income of $90,303, the highest on this list. Considered the “capital” of Silicon Valley, San Jose is a pioneer in technology and engineering and benefits from the proximity of top universities such as Berkeley and Stanford. However, all of these advantages also come with a price tag – the cost of living is among the highest in the U.S.
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1. Columbus, OH
- Gini Index: 44.72
- Median Household Income: $47,156
- Population: 837,038
Home to the prestigious Ohio State University, the Battelle Memorial Institute, and an advanced technology and service sector, Ohio was recently described by NPR as “recession-proof.” The city’s cost of living is around the national average and its job growth is increasing, leading to more opportunities across a diversified economy.