Income inequality in Oregon hits new record

Businessman on a suit walking past a man sleeping on a bench.

Income inequality in Oregon hits new record

Businessman on a suit walking past a man sleeping on a bench.

Income inequality in Oregon hits new record

Oregon’s ultra-rich took home more money than ever before in 2020, the first year of the pandemic. Newly available tax return data from the Oregon Department of Revenue shows that the gulf between the top 0.1 percent of Oregonians — the richest 1 in every 1,000 Oregonians — and the Oregonian in the middle has never been wider.[1]

Income inequality undermines the well-being of Oregonians at a fundamental level. Research shows that income inequality limits social mobility, hindering the possibility for a child born into poverty to move out of it. It leads to worse physical and mental health outcomes, particularly for those lower on the economic ladder. Moreover, income inequality slows economic growth, innovation, and investment.[2]

Income of Oregon’s ultra-rich sets new record

The average income of the top 0.1 percent of Oregonians soared to nearly $5.6 million in 2020.[3] Adjusted for inflation, that is the highest that figure has stood in the state dataset dating back to 1980. Since that time, the average annual income of Oregon’s ultra-rich has grown nearly five times over.

To be among the 1,949 households in this group, a taxpayer needed to earn more than $1.9 million in 2020.

While the gains of those at the very top fueled the rise of the top 1 percent’s income as a whole, the rest of the top 1 percent of Oregonians still saw their inflation-adjusted income more than double from 1980 to 2020. On average, Oregonians in the rest of the top 1 percent took home nearly $800,000 in 2020.


Income of the rich soars, while the middle stagnates

Meanwhile, the Oregonian in the middle has seen their income stagnate over the last several decades. In 2020, the typical (median) Oregonian took home a little more than $39,000. That was just 7.5 percent more than they earned in 1980, and less than what the Oregonian in the middle took home 20 years ago.


Typical Oregonian would need to work 143 years to match income of the super-rich

It would take the typical Oregonian in 2020 more than 143 years to amass the average income a member of the state’s top 0.1 of 1 percent took home in one year. In 1980, the Oregonian in the middle would only need about 26 years to earn the income equivalent to the top 0.1 of 1 percent. 

The richest 1 percent together make more than entire bottom half of Oregonians

Oregon’s prosperity is shared so unequally that the top 1 percent takes home more income than the bottom 50 percent of Oregonians combined. In 2020, the top 1 percent of Oregonians – about 19,200 tax filers – took home more than $24.6 billion. That same year, the nearly 950,000 Oregonians in the bottom half of the income ladder collectively earned $19.7 billion. The roughly $5 billion difference between the two groups was more than the state allocated for the entire Department of Human Services in the two-year 2021-23 budget period.[4]

Grotesque levels of income inequality do not have to be the norm. More equitable tax policy can help alleviate these disparities. Lawmakers can – and should – raise taxes on the rich in order to invest in things that support the well-being of Oregonians more broadly.

[1] This fact sheet uses the terms “Oregonians” and “taxpayers” interchangeably. Unless otherwise noted, these refer to all Oregon income tax filers. In some instances, Oregon Department of Revenue data is only available for full-year resident income tax filers. In those instances, we note that the data is for full-year filers in the chart’s footer with an endnote. Unless otherwise noted, all figures are OCPP analysis of Oregon Department of Revenue data.

[2] See Polacko, Matthew. “Causes and Consequences of Income Inequality – An Overview” Statistics, Politics and Policy, vol. 12, no. 2, 2021, pp. 341-357; Berg, Andrew G. and Jonathan D. Ostry, “Equality and Efficiency,” Finance & Development, Vol. 48, No. 3, September 2011; Ostry, Jonathan D., Andrew Berg and Charalambos G. Tsangarides, Redistribution, Inequality, and Growth, International Monetary Fund, February 2014; Boushey, Heather and Carter C. Price, How Are Economic Inequality and Growth Connected? A Review of Recent Research, Washington Center for Equitable Growth, October 2014; Ryder, Guy, Urgent Action Needed to Break Out of Slow Growth Trap, International Monetary and Financial Committee, International Monetary Fund, Thirty-Third Meeting, April 16, 2016; Dabla-Norris, Era, Kalpana Kochhar, Nujin Suphaphiphat, Frantisek Ricka, Evridiki Tsount, Causes and Consequences of Income Inequality: A Global Perspective, June 2015; “Trends in Income Inequality and its Impacts on Economic Growth,” OECD Social, Employment and Migration Working Papers, No. 163, OECD Publishing, 2014; Orrson, James, Income Inequality in America: A Call for Action and Effective Policy, White Paper, May 2015; Chetty et al. “The Association Between Income and Life Expectancy in the United States, 2001-2014”, Clinical Review and Education, 2016. On the intersection between the COVID-19 pandemic and economic inequality, see Heather Boushey and Somin Park, The coronavirus recession and economic inequality: A roadmap to recovery and long-term structural change, Washington Center for Equitable Growth, August 31, 2020.

[3] Calculations for top one-tenth of 1 percent and the rest of the top 1 percent are based on total income for full-year returns because of limitations in data availability of other types of returns.

[4] Oregon Legislative Fiscal Office, “2021-23 Legislatively Adopted Budget: General Fund/Lottery Funds Summary,” July 2021.

Tyler Mac Innis

Tyler Mac Innis

Tyler Mac Innis is a Policy Analyst with the Oregon Center for Public Policy

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