/ |

Middle-class status eluding more Americans

AP

A sense of belonging to the middle class occupies a cherished place in America. It conjures images of self-sufficient people with stable jobs and pleasant homes working toward prosperity.

Yet nearly five years after the Great Recession ended, more people are coming to the painful realization that they are no longer part of it.

They are former professionals now stocking shelves at grocery stores, retirees struggling with rising costs and people working part-time jobs but desperate for full-time pay. Such setbacks have emerged in economic statistics for several years. Now they are affecting how Americans think of themselves.

Since 2008, the number of Americans who call themselves middle class has fallen by nearly a fifth, according to a survey in January by the Pew Research Center, from 53 percent to 44 percent. Forty percent now identify as either lower-middle or lower class, compared with just 25 percent in February 2008.

According to Gallup, the percentage of Americans who say they are middle or upper-middle class fell 8 points between 2008 and 2012, to 55 percent.

And the most recent General Social Survey, conducted by NORC at the University of Chicago, found that the vast proportion of Americans who call themselves middle or working class, though still high at 88 percent, is the lowest in the survey’s 40-year history. It has fallen 4 percentage points since the recession began in 2007.

The trend reflects a widening gap between the richest Americans and everyone else, one that has emerged gradually over decades and accelerated with the Great Recession. The difference between the income earned by the wealthiest 5 percent of Americans and by a median-income household has risen 24 percent in 30 years, according to the Census Bureau.

Whether or not people see themselves as middle class, there is no agreed-upon definition of the term. In part, it is a state of mind. Incomes or lifestyles that feel middle class in Kansas can feel far different in Connecticut. People with substantial incomes often identify as middle class if they live in urban centers with costly food, housing and transportation.

In any case, individuals and families who feel they have slipped from the middle class are likely to spend and borrow less. Such a pullback, in turn, squeezes the economy, which is fueled mainly by consumer spending.

More people now think “it’s harder to achieve” the American dream than thought so several decades ago, said Mark Rank, a sociology professor at Washington University in St. Louis.

Americans’ self-perception coincides with data documenting a shrinking middle class. The percentage of households with income within 50 percent of the median — one way to define a broad middle class — fell from 50 percent in 1970 to 42 percent in 2010.

Roughly 8.4 percent of respondents to the General Social Survey, last conducted in 2012, said they consider themselves lower class. That is the survey’s highest percentage ever.

Tom Smith, director of the survey, said even slight shifts are significant. Class self-identification “is traditionally one of the most stable measures” in the survey, he said.

Why do so many no longer regard themselves as middle class? A key reason is that the recession eliminated 8.7 million jobs. A disproportionate number were middle-income positions. Those losses left what a “hollowed out” workforce, with more higher- and lower-paying and fewer middle-income jobs.

Factors economists cite as markers of middle-class status include home ownership, being able to vacation, help children pay for college and save for a secure retirement.