Half of families in Gateway Cities said they wouldn’t be able to cover a $400 emergency, compared to 33% in Greater Boston.
That’s one of the striking findings of a recent report from the Federal Reserve Bank of Boston looking at family wealth across the Commonwealth.
“The Gateway Cities really stood out as having more economic challenges. Families have lower wealth, less of a buffer,” said Beth Mattingly, one of the report’s authors.
The report further highlights how the state’s Gateway Cities — former industrial hubs that are home to large immigrant and lower-income populations — are seeing drastic challenges when it comes to wealth in the state.
Last week’s report is a follow-up to a 2015 report which focused on wealth in Boston. In a statistic that has been cited several times in the decade since, that report, called the Color of Wealth in Boston, estimated the median net worth of Black families in the state at just $8.
The updated report focused on wealth throughout the state and found that Gateway Cities are behind the curve.
“The consistent position of the Gateway Cities was striking,” Mattingly said.
Another significant finding is that the median family net worth in Gateway Cities is just $101,500. That’s less than a third of $373,000 in Greater Boston. Despite the wide gap, half of the state’s Gateway Cities are within Greater Boston.
A quarter of the state’s population live in Gateway Cities, about 1.9 million residents. There are 4.5 million in the five counties of Greater Boston — Essex, Middlesex, Norfolk, Plymouth and Suffolk.
Nearly a quarter of Gateway City families have zero to negative net wealth — assets minus debts — compared to nearly 16% statewide. Even the top quarter of high-wealth families in Gateway Cities earn about a third of Greater Boston high-wealth families.
The report also found that liquid net wealth — that which can be quickly converted to cash, unlike houses and cars — among Gateway Cities families is close to zero, with a median of just over a thousand dollars. That tally in Greater Boston is $67,000.
Mattingly said net worth is a significant indicator to gauge financial health but it isn’t the only one.
“I would argue that it’s absolutely essential to think about wealth when we’re thinking about someone’s finances. But it is insufficient to think about wealth. We also need to think about income,” she said.
Despite these illuminating findings, Mattingly said the report isn’t an attempt to explain the disparities in Gateway Cities.
“I wouldn’t want someone to take away a complete portrait of the Gateway Cities based only on this report, even an economic portrait, because there’s a lot more to the story that we don’t cover,” she said.
She does hope, however, the report spurs conversation about what needs to be done to address the stark gaps. “My hope is that this can inform a host of conversations that address that question, that bring a range of perspectives to the table.”
Matthew McCall, vice president of community programs for family service organization The Home for Little Wanderers, sees the effects of those disparities every day.
“We see that in almost every community that we do work in,” McCall said. “There is that disparity [and] I think you see a greater proportionality of that in certain communities.”
The Home for Little Wanderers runs the Family Resource Center and a community service agency that serves Chelsea and Revere.
McCall said it’s common for him to see situations where poverty is mistaken for neglect or abuse, simply because families don’t have the resources.
“It’s [though] that $400 that we can help them,” McCall said. “Everybody in that family, but also everyone in our community, is better off for that because of this little bit of help that got this family to a far more stable place and a place where they’re able to overcome some of those economic inequalities that you might see within those communities.”
McCall said his organization helps families with everyday expenses, like diapers, and even larger recurring expenses like utility bills.
McCall said that often, when discussing what it means to address certain inequalities of communities facing these kinds of economic challenges, it’s presented as a large and expensive undertaking. But he says there are a plethora of small actions that organizations like his can take that help entire communities.
“So really thinking about what are some of those small moves we can do also to have those big impacts can be brutally important as well,” McCall said.
