United States is one of the richest countries in the world. By the word “richest”, one means that the most of the wealth is controlled by few individuals who run the system. It is nowhere related to a common man’s life. In the century we are living in, income and wealth inequality issues have been coming up a lot and has also become a major political issue now. Income equality could be defined as the distribution on income in an uneven manner among the population.?According to a research done by Pew Research Center analysis of US census Bureau data, the over all rate of the poverty in United states declined and income rapidly when up to the second straight year in 2016 and on the other hand, many poor American were getting more poor. This is a result of the income and wealth equality that are getting into the roots of the system and making it more and more difficult to overcome this. From $12,000 per single person to $25,000 per family of four, the US census poverty threshold has been going up since 2016. In recent years, these families also saw their income fall further below the poverty line.?A new survey from the Federal Reserve was conducted to checkup on the nation’s finances which stated that the wealth inequality has still climbed to new heights while the low and middle income workers have started to recover. ?Another report by Estelle Sommeiller, Mark Price, and Ellis Wazeter submitted in June 2016 shows how Income inequality has risen. Inequality in the United States has increased more for the common man. According to Fed, household net worth have improved by 16% from 2013 to 2016 across all income brackets. On the other hand, the top end of the income spectrum did the best, as the top 10% of earners saw their net worth increase 40% over three-year period. The families in the upper income bracket are now worth $810,800 which where earlier $70,000 in 2007 during the recession. ?Many differences are seen in the income brackets. White people with low income have seen their wealth cut in half after the recession. The net worth of black and Hispanic families remained stable.Picture1: Household Net Worth for whites, Hispanics and Blacks.?The assets between the non white and white people remain enormous. Recession has narrowed the gap among the lower income earners. AS the share of poor families increased in the last few years, families have also seen a change in their income which went below the poverty line. ?As per the Census data, there is a different trend seen for American families who were not in poverty in 2016. The amount of family’s income is above the poverty threshold was at least $15,000. ?The reason for income inequality is because of the cheap labor in China and the unfair exchange rates. The jobs outsourcing done by most of the corporations in United States in to be blamed for the wealth inequality. US companies have to lower their prices in order to survive in the market and to be competitive with the lower priced Chinese and Indian companies.?United States has lost 20 percent of its factory jobs since 2000. There is an increase in the service jobs, but these service jobs are much lower paid. Technology also increases income inequality as automation is now preferred by many big companies. Workers who are trained in technology are paid higher.?The level of inequality is increasing significantly. The trend shows no sign of reversing. The growing income inequality and stagnant incomes for the majority of Americans results in weak demand and slower growth. The income inequality in United states has risen to levels that threaten the economy’s growth and the health of democracy. ?Income inequality is also defined as the percentage of income to a percentage of population. People consider it unfair as the rich is getting more and more rich and poor is getting even poorer. The income inequality and its causes change according to the region, education, social status and the gender. It has been observed that since 1980, Income equality has grown from 30 to 35% and most of the income is going to the top 10% earners. The increase in the percent of income to 50% is creating a huge disparity between high and low earners. ?One of the most common factors that effect the inequality is education. There are many social-economic groups of people who do not have access to the good quality education in united states. The countries that provide great quality higher education have much less income disparity. The reason behind this is that providing higher quality education results in competition executive talent and provides them higher level of salaries. Fixed wages play a vital role in inequality. ?High demand for high skilled workers also increases the wage gap. Many multinational companies are investing more and more in high skilled workforce. This again increases the pay structures for this high skilled workers and leads to a decrease in the wages for low skilled workers.?Family and social interaction is one of the other causes for income inequality as this impacts the earning potential. The social and emotional skills are needed to lead a quality life. There are many middle class families which do not have these skills and are not sufficiently developed and lead to a high percentage of unstable families.?There is a need to get rid of the income inequality. This would result in the improvement of the economic stability of the country. Global distribution of wealth is the main solution for preventing the wealth inequality. Necessary changes should be made as the transition is gradual and healthy for overall economy.