Posted on 01/09/2023 8:52:44 AM PST by grundle
Yes, the America middle class is disappearing. At least as defined by the above WSJ chart. 38% of US families were middle class in 1979 vs. 32% in 2014.
But where did that 7% (6.8 percentage points to be exact) go? Well, of the five income groups (poor, lower middle class, middle class, upper middle class, and rich) displayed, the bottom three got smaller, the top two bigger.
The poor shrank by 4.5 percentage points, the lower middle class by 6.8, the middle class also by 6.8% But the upper middle class got a lot bigger, expanding by 16.4 points, and the rich by 1.8 points. Oh, and here is how upper middle class is defined, using research from economist Stephen Rose of the Urban Institute:
Using Census Bureau data available through 2014, [Rose] defines the upper middle class as any household earning $100,000 to $350,000 for a family of three: at least double the U.S. median household income and about five times the poverty level. At the same time, they are quite distinct from the richest households. Instead of inheritors of dynastic wealth or the chief executives of large companies, they are likely middle-managers or professionals in business, law or medicine with bachelors and especially advanced degrees.
Smaller households can earn somewhat less to be classified as upper middle-class; larger households need to earn somewhat more.
Mr. Rose adjusts these thresholds for inflation back to 1979 and finds the population earning this much money has never been so large. One could quibble with his exact thresholds or with the adjustment that he uses for inflation. But using different measures of inflation, or using higher income thresholds for the upper-middle class, produces the same result: substantial growth among this group since the 1970s.
(Excerpt) Read more at aei.org ...
Two class system. How Soviet of them.
WSJ. Fake news for the elite.
“But where did that 7% (6.8 percentage points to be exact) go? Well, of the five income groups (poor, lower middle class, middle class, upper middle class, and rich) displayed, the bottom three got smaller, the top two bigger.
The poor shrank by 4.5 percentage points, the lower middle class by 6.8, the middle class also by 6.8% But the upper middle class got a lot bigger, expanding by 16.4 points, and the rich by 1.8 points. Oh, and here is how upper middle class is defined, using research from economist Stephen Rose of the Urban Institute:”
Been watching this for some time, it’s very good news. I keep seeing all the opportunities that abound despite all our “problems” and I’m glad to see people are taking advantage of them. I hope more people get the moxie to do the same. Money is “laying on the ground” all over the place, go pick it up!
“...defines the upper middle class as any household earning $100,000 to $350,000 for a family of three...”
~~~
They say that they adjust this for inflation, but I don’t think they are comparing actual costs versus standard of living. There is no way a family of three is going to have an upper-middle class house and lifestyle without going deeply into debt for 100k/year
Some people just don’t want to prosper, it’s sad.
I think the cost of housing has increased more than the general rate of inflation since 1979.
So that would definitely impact a middle-class lifestyle, as it relates to home ownership or the type of home that people live in.
“They say that they adjust this for inflation, but I don’t think they are comparing actual costs versus standard of living. There is no way a family of three is going to have an upper-middle class house and lifestyle without going deeply into debt for 100k/year”
That’s true if you live in San Francisco or similar places but most people live where the cost of living is much less.
Some folks are just so determined that everything be bad that’s all they can see. If things are so bad how did we go from 25% of all homes being free and clear of debt to 37%? That’s an amazing number Also, most homeowners that have mortgages are sitting on super-low rates right now.
If we can trust this data, it is a remarkable affirmation of free enterprise and all the traditional institutions required to succeed in the USA.
I suspect the growth in the upper middle class not only has a high level of skill and work effort, but high levels of responsible behavior like marriage, almost zero criminal behavior and few children born out of wedlock.
You don’t know what you’re talking about if you think 100K a year for a family is enough.
You should go to work for the Biden Administration.
“I think the cost of housing has increased more than the general rate of inflation since 1979.”
I know this to be true since it’s been my work since 1979 when I bought two little building lots and turned $4,200 into $21,500 in 3 years.
Land has gone up even more than housing. I’ve kept buying, holding and selling it since ‘79. Ride the waves and prosper. It doesn’t matter where you start, it only matters that you start. Almost every prosperous person I talk to says they’ve made more money in real estate than anything else and that includes people who have made a lot of money in other businesses and/or jobs. They say they had successful careers but made their biggest money buying real estate.
One of the common saying among long timers in real estate is “You don’t make money selling real estate, you make money buying it.”
it looks like the number of lower middle class and poor shrunk indicating increased prosperity simply based on the numbers.
Obviously they don’t consider inflation much as while I make about twice what I did 20 years ago I do not live as well.
No, thanks, I don’t need political parties. I just need opportunity and I see it everywhere and have for many year.
Sure.
ping
The problem is the workers that have been at the job for years start to make the same (or less!!!) than the new hires that know nothing. Sometimes you end up training a new hire that is making MORE than you do!!! It happend to me. Then the job hopping starts in ernest.
I figured out by the time I was about 28 that no govt or person was going to make me prosper. I had to do it myself. The wife lived below our means and invested the extra until I was 60 and she was 53, then we retired. I make more money now in retirement than I average in my “working” life. I have friends who have done the same.
Old habits don’t die easy. I could drive anything I want now but my daily driver is a 14 year-old pickup. It’s a habit and I like my old truck.
You’re wonderful...
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