(BLOOMBERG) Bad news for cash-strapped workers hoping to eventually break into the 1 percent: How much you make over your lifetime has less to do with grit and more to do with what you earn during your first decade in the labor market, a new report shows.
Economists at the Federal Reserve Bank of New York said in a report published on Friday, Feb. 6, that people who end up wealthy see a much steeper curve in their earnings than the rest of us. People projected to earn the median amount will see their earnings grow 38 percent from the time they're 25 to when they turn 55; those in the 95th percentile will see their earnings grow 230 percent over the same period; and those in the 99th percentile will see their earnings grow 1,450 percent. That may seem obvious—those at the top of the wealth differential were probably propelled there by astronomical earnings growth, not a streak of flat earnings. The Fed report, however, points out that the steepest pay increases happen early. "Across the board, the bulk of earnings growth happens during the first decade," wrote Fatih Guvenen, Fatih Karahan, Serdar Ozkan, and Jae Song.