The vast majority of middle-class Americans say their financial well-being has been crimped over the last 10 years by sagging home values and dreary job prospects, according to a new survey.
About 85% of middle-class people say it’s tougher now than a decade ago to maintain their living standards, according to the Pew Research Center report.
“Since 2000, the middle class has shrunk in size, fallen backward in income and wealth, and shed some — but by no means all — of its characteristic faith in the future,” the report states.
The survey, “The Lost Decade of the Middle Class,” defines a middle-income household as a family of three earning $39,418 to $118,255.
The report reiterates what has become a common theme among demographers and economists: The financial status and outlook for the middle and lower classes has weakened while the fortunes of the wealthy have significantly brightened.
Median middle-class income dropped 5% in the 2000s, while net worth plummeted 28% — to $93,150 from $129,582 — as housing prices shriveled, the report said.
The middle class has steadily shrunk over the years, falling to 51% of the population in 2011 from 61% in 1971, the report found.
That’s not all bad. The upper class rose to 20% of the population from 14% during that span, meaning more than half of the decline in the middle class is attributable to people advancing to the wealthier category.
But the upper class’s share of national income has risen far more dramatically, climbing to 46% from 29% four decades ago. In other words, the rich have gotten much richer.
The report was based on a survey of 1,287 adults who describe themselves as middle-class, as well as Pew’s analysis of data from the Census Bureau and the Federal Reserve.
The troubles of the middle class would seem to give President Obama an edge over Republican challenger Mitt Romney among that demographic.
Among middle-income voters, 52% say Obama’s policies would help them vs. 42% who say the same for Romney.