WASHINGTON – The middle class is receiving less of America’s total income, declining to its smallest share in decades.
A study released Wednesday by the Pew Research Center highlights diminished hopes, too, for the roughly 50 percent of adults defined as middle class, with household incomes ranging from $39,000 to $118,000. The report describes this mid-tier group as suffering its “worst decade in modern history,” having fallen backward in income for the first time since the end of World War II.
Three years after the recession technically ended, fewer middle class Americans believe that hard work will allow them to get ahead in life. Families are now more likely to say their children’s economic future will be the same or worse than their own.
The Pew study is just the latest indicator of a long-term trend of widening U.S. income inequality. The Census Bureau reported last year that income fell for the wealthiest – down 1.2 percent to $180,810 for the top 5 percent of households. But the bottom fifth of households – those making $20,000 or less – saw incomes decline 4 percent.
The new study reviewed 2010 data from the Census Bureau and Federal Reserve, defining “middle class” as the tier of adults whose household income falls between two-thirds and double the national median income, or $39,418 to $118,255 in 2010 for a family of three. By this definition, “middle class” makes up about 51 percent of U.S. adults, down from 61 percent in 1971.
In 1970, the share of U.S. income that went to the middle class was 62 percent, while wealthier Americans received 29 percent. By 2010, the middle class had 45 percent of the nation’s income, tying a low first reached in 2006, compared to 46 percent for upper-income Americans.