Wednesday, May 11, 2016

The Disappearing Middle Class

There's a fascinating study out from the Pew Research Center, showing what's happening to a legendary but shrinking group of people: the American middle class. In nearly one-quarter of metro areas, middle-class adults no longer make up a majority. That’s up from fewer than 10 percent of metro areas in 2000.

Nationally, the proportion of middle-class adults shrank to 51 percent in 2014 from 55 percent in 2000, Pew found. Upper-income adults now constitute 20 percent of the population, up from 17 percent. The lower-income share has risen to 29 percent from 28 percent.

Pew defines the middle class as households with incomes between two-thirds of median income and twice the median, adjusted for household size and the local cost of living, which means a three-person household was middle class in 2014 if its annual income fell between $42,000 and $125,000. But because the median household income in the U.S. has fallen since 1999, the minimum amount it takes to be middle income has also fallen: from $45,115 in 1999 to $41,641 in 2014.

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