Americas Shrinking Middle Class
Digested from The American Middle Class Is Losing Ground
Pew Research Center (12/9/15)
Middle-income families were 61 percent of the U.S. population in 1971; now they are 50 percent of the population, with 29 percent of the population constituting lower-income families and 21 percent upper-income families.
Wealth distribution also is changing drastically. Upper-income families in 1971 received 29 percent of aggregate household income; now they receive 49 percent. Middle-income families, on the other hand, have gone from bringing home 62 percent of aggregate housing income in 1971 to 43 percent in 2014. The demographics affected most greatly since 1971 are those with only a high school diploma or less than a high school diploma (no college degree); those with some college or a two-year degree; Hispanics; and young adults (ages 18 to 29).
Middle-income household wealth also hasnt recovered as well from the Great Recession as has upper-income families' wealth mainly because middle-income wealth is more heavily tied to housing, which hasnt rebounded as quickly as the stock market has. The gap in wealth between the two tiers has also reached record highs: Upper-income families wealth has increased since 2010, while middle-income household wealth has remained relatively stagnant over that period.
If wealth for middle-income families continues to stagnate, they may have an even harder time affording rent, especially as more luxury apartment homes come on the market.