12/4/2023 0 Comments Income of upper middle class![]() No wonder so many feel frustrated.Īnd for too long, the country’s economic policy, even under Democrats, has blurred the distinction between the upper middle class and the actual middle class. They aren’t receiving their fair share of the country's economic growth. These households aren’t making six-figure incomes, and they have received only meager raises over the past few decades. You probably have big mortgage payments, rising medical costs and perhaps eye-popping tuition bills.īut I’d ask you to spend a minute thinking about how much more challenging life is for the bottom 90 percent. If you, dear reader, happen to be in this group, I’m not trying to dismiss your economic anxieties. Since 1980, the incomes of the upper middle class have been growing at almost the identical rate as the economy. Their income path doesn’t look like that of either the first or second group. Over time, their share of the economy’s bounty has shrunk.įinally, there is the upper middle class, defined here as the 90th to 99th percentiles of the income distribution (making roughly $120,000 to $425,000 a year after tax). Even so, the incomes of the bottom 90 percent have trailed G.D.P. The numbers here take into account taxes and government transfers, like Social Security, financial aid and anti-poverty benefits. Then there are the bottom 90 percent of households, who are in the opposite position. They are now capturing an even greater share of the economy’s bounty. Their post-tax incomes (and wealth) have surged since 1980, rising at a much faster rate than economic growth. The first is indeed the top 1 percent of earners, and especially the very richest. To make grand pronouncements about the American economy, you need to talk about three groups. It shows that both sides have a point - but that it’s a mistake to divide the country into only two groups. I think the chart above helps to resolve the debate. ![]() Richard Reeves’s recent book, “Dream Hoarders” made this case, as did Matthew Stewart’s well-titled Atlantic article: “The 9.9 Percent Is the New American Aristocracy.” To them, the upper middle class is on the happy side, enjoying rising incomes, longer lifespans, stable marriages and good schools. Inflation hardship information by detailed income group is courtesy of Gallup.On the opposing side are people who believe that the country’s defining class line is further down the economic ladder. Our story references Urban Institute’s definition of the “middle-middle” class, rather than the full range of lower-middle-, middle-middle- and upper-middle-class incomes.ĭata about retirement savings and emergency savings were calculated from the Federal Reserve Board’s Survey of Household Economics and Decisionmaking microdata. Stephen Rose at the Urban Institute, whose definition of the middle class is cited in this story, could not be reached for comment. Rakesh Kochhar at the Pew Research Center, Richard Reeves at Brookings, Caitlin Zaloom at New York University and Rachel Sherman at the New School were consulted for this story. ![]() Our three definitions of the middle class come from the Pew Research Center (distance from median income), Brookings Institution (middle 60 percent of household incomes) and Urban Institute (distance from the 2021 poverty level). The Census Bureau does not calculate median incomes for all rural areas, so we used the median of median incomes in a state’s rural Zip codes as a comparison point. Income for Zip codes and core-based statistical areas are based on the Current Population Survey using data collected between 20. The national distribution of household income across the United States was calculated from the 2022 Current Population Survey’s Annual Social and Economic Supplement. We used a variety of data sources on income. Paper and bill textures in topper from iStock. Reporting by Alyssa Fowers, Shelly Tan, Luis Melgar and Kevin Schaul.
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