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A Bloomberg report found the 500 richest people in the world have collectively lost $1 trillion this year.
That’s because stocks have been plunging.
In contrast, the lowest earning Americans are seeing their pay rise at a solid clip.
Americans aren’t feeling great about the economy.
Inflation is high, and the markets aren’t looking too hot. As stocks plunged this week, so did the net worth of a whole lot of rich people, who tend to have their wealth parked in assets. Indeed, Bloomberg’s Joe Weisenthal reports that the 500 richest people in the world have lost over $1 trillion this year.
As Weisenthal notes, that creates an interesting contrast between two very disparate types of people in the American economy: Those vying for jobs and seeing hourly wages soar — and those whose net worth comes from assets.
For instance, as crypto takes a major hit, Bloomberg reported that Coinbase founder Brian Armstrong has seen his net worth fall from $8 billion in March to just $2.2 billion. It’s not just Armstrong: Bloomberg found that Changpeng Zhao, the CEO of Binance, had seen his net worth shrink from $96 billion in January to $11.6 billion.
The cumulative $1 trillion loss still leaves plenty for the ultra-wealthy. During the pandemic, the wealthiest people in America — and the world — were notching huge gains. An Oxfam brief found that, from March 2020 to March 2022, American billionaires’ wealth grew by 62%, bringing their net worths to $4.7 trillion. Another Oxfam report found that the world’s 10 richest men more than doubled their cumulative wealth from March 2020 to November 2021, increasing their collective net worths from $700 billion to $1.5 trillion. At that rate, they were making $15,000 every second.
Tech salaries serve as a good example of where those losses are being felt even among those not at the very top. As Insider’s Kylie Robison reports, high-paying Big Tech firms often try to entice workers in with equity. Their offer letters don’t just have a paycheck, but what’s called “restricted stock units,” offering shares to employees pegged to the market price of the stock on the day it’s distributed. That’s led to a lot of those workers seeing a big dip in their compensation.
These losses probably aren’t making as big of a dent in the richest of the rich’s wallets, but they do represent a slightly different trend in who’s making more money. Wages have been skyrocketing over the last year, as workers quit and job switch at record rates — and employers are left trying to figure out how to entice them in.
According to the Bureau of Labor Statistics, average hourly earnings rose 5.5% from April 2021 to April 2022. Americans now earn an average of nearly $32 an hour.
A lot of those wage gains are still being eaten up by inflation, of course. The most recent data from the Consumer Price Index found that inflation had grown 8.3% year-over-over as of April — and that’s a slowdown.
But some of the lowest-paid workers have seen their wage gains outpace inflation, as Insider’s Ben Winck and Madison Hoff report. When adjusting for inflation, leisure and hospitality workers have seen their real wages grow by 4.2% since January 2021. The Federal Reserve Bank of Atlanta’s wage tracker says that the lowest earning quartile of workers have seen their wages grow 6.4% in the past year, far higher than the other quartiles.
So in this market madness, there is yet another topsy turvy trend: The richer getting not quite as rich.
Economy, Economy, Economy & Markets, Stock Market, ultra wealthy, Billionaires, Income Inequality, Wealth Tax
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