Most Americans No Longer Are Middle Class, Decline For 4 Decades; Pew Research Ctr, Review
'The Tipping Point: Most Americans No Longer Are Middle Class.' NPR, *Dec. 9, 2015. ~ Review.
Americans have long lived in a nation made up primarily of middle-class families, neither rich nor poor, but comfortable enough. This year, that changed, according to the Pew Research Center. A just-released analysis of government data shows that as of 2015, middle-income households have become the minority. The trend is so firmly established that it may well continue; Americans have experienced "a demographic shift that could signal a tipping point," Pew researchers concluded Wednesday.
Thanks to factory closings and other economic factors, the country now has 120.8 million adults living in middle-income households, the study found. That compares with the 121.3 million who are living in either upper- or lower-income households. "The hollowing of the middle has proceeded steadily for the past four decades," Pew concluded.
And middle-income Americans not only have shrunk as a share of the population but have fallen further behind financially, with their median income down 4 percent compared with the year 2000, Pew said. So what exactly does it mean to be a middle-income family?
- Less Than Half Of Adults Now Middle Class -
The middle class, which has long made up the majority of the U.S. population, finally dipped below 50 percent in 2015. Pew defines middle-class income as at least two-thirds of the U.S. median household income, but no more than double the median. (SEE Graph).
Pew starts with the U.S. median household income, which is the paycheck smack in the middle of them all, lined up from smallest to biggest. In other words, half of all households earn more, and half earn less. Then Pew defined "middle class" as households that had at least two-thirds of the median income, but no more than double that amount. And it adjusted for household size.
Bottom line: For a household with three people, being middle class means making between about $42,000 and $126,000. If your family of three makes less than $42,000, then you are in the lower class. If your family brings in more than $126,000, you are in the upper class.
Using that formula, Pew concluded that back in 1971, about 2 out of 3 Americans lived in middle-income households. Since then, the middle has been steadily shrinking. Today, just a shade under half of all households (about 49.9 percent) have middle incomes.
Slightly more than half of Americans (about 50.1 percent) either live in a lower-class household (roughly 29 percent) or an upper-class household (about 21 percent).
But Pew also points out that Americans have all gained. That is, the median income has risen 34 percent since 1970...
More, https://www.npr.org/sections/thetwo-way/2015/12/09/459087477/the-tipping-point-most-americans-no-longer-are-middle-class
- Pew Research Center, Study Report, The American Middle Class Is Losing Ground (2015)
https://www.pewsocialtrends.org/2015/12/09/the-american-middle-class-is-losing-ground/
- (Wiki) Middle Class 'Shrinkage'
(If you can read this graph and you dislike euphemisms raise your hand. Lol).
https://en.wikipedia.org/wiki/Middle-class_squeeze
- (Wiki) Middle Class, 'Squeeze,' "Income changes," *See also: Income inequality in the U.S. Excerpt:
There are many causes of middle-class income stagnation in the United States. One narrative involves the interplay of globalization, supply chain innovation and technology, which has enabled lower-wage workers in developing countries (e.g., China) to compete with higher-wage workers in developed countries (e.g., the U.S.) As a result, middle-class incomes have grown in developing countries like China much faster than in the U.S. measured from 1988 to 2008.
Another narrative described by Paul Krugman is that a resurgence of movement conservatism since the 1970s, embodied by Reaganomics in the United States during the 1980s, resulted in a variety of policies that favored owners of capital and natural resources over laborers. Many developed countries did not have an increase in inequality similar to the United States over the 1980-2006 period, even though they were subjected to the same market forces via globalization. This indicates U.S. policy was a major factor in widening inequality.
Either way, the shift is visible when comparing productivity and wages. From 1950 to 1970, improvement in real compensation per hour tracked improvement in productivity. This was part of the implied contract between workers and owners. However, this relationship began to diverge around 1970, when productivity began growing faster than compensation. A declining labor movement, increasing executive pay relative to the average worker, financialization of the economy, and increasing diversion of corporate profits to stock buybacks and dividends are some of the contributing factors to this wage stagnation. In general, for a variety of reasons, the power of lower paid laborers relative to capitalists and landlords has declined...
- 50 Yrs. Of Spectacular Gains For The Wealthiest, New Stats From G Zucman; 'Tired Of Winning Yet?' Dec. 12, 2019.
https://www.democraticunderground.com/1016244193
- Exclusive: 40% in U.S. Can't Afford Middle-Class Basics, Axios, May 16, 2018
https://www.axios.com/americans-who-cant-afford-middle-class-basics-united-way-5da1e2e6-046b-4a53-9a11-1106a77564ef.html
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