Twelve percent of Americans will be part of the 1 percent, but only 0.6 percent will stay there.
In a study for Cornell University, Thomas A. Hirschl and Mark R. Rank looked at 44 years of data to find out which Americans were in the 1 percent. What they found was striking: 12 percent of Americans 25 to 60 appeared in the top 1 percent of income for at least one year; 39 percent spent a year in the top five percent; 56 percent spent a year in the top 10 percent; and 73 percent spent a year in the top 20 percent.
But while 12 percent of people spent a year in the top 1 percent of earners, only 0.6 percent of people spent 10 years there.
In an op-ed in the New York Times, Rank writes, “Rather than being a place of static, income-based social tiers, America is a place where a large majority of people will experience either wealth or poverty—or both—during their lifetimes.”
What does this new data mean for retailers? It’s more evidence that you really can’t tell who are the top earners—or the top spenders.