There should always be income inequality in a capitalist system, but the critical question is whether there is some level of disparity at which there are serious societal problems. The following graphic, which is graciously provided by Visual Capitalist, portrays income trends for various groups since 1979. The data represent average hourly earnings after adjustment for inflation.
Note that growth in wages for the highest income earners has been more than twice that of the other four groups. In absolute dollars, the high earners garner wages that are almost two- and one-half times those of the middle-income cohort and more than four times the earnings of the low-income group.
However, a casual glance at the chart suggests that the curve has recently been much steeper for the low wage earners. From 2019 to 2023, wages for the bottom 10% of earners grew by 13.2% annually as compared to 3% for middle income workers and 4.4% for the upper decile of earners. Once again, it is difficult to opine on the “right” level of earnings disparity in a free-market economy but closing the gap at least to some extent would seem to be salutary.