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, middle class Americans are still feeling the economic pinch, with most saying they have been forced to reduce spending in the past year. And fewer now 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.
In all, 85 percent of middle class Americans say it is more difficult now than a decade ago to maintain their standard of living. Some 62 percent say a lot of the blame lies with Congress. A slight majority say a lot lies with banks and other financial institutions. Just 8 percent blame the middle class itself.
“The job market is changing, our living standards are falling in the middle, and middle-income parents are now afraid that their children will be worse off than they are,” says Timothy Smeeding, a University of Wisconsin-Madison economics professor who specializes in income inequality.
He said that many middle-income families have taken a big hit in the past decade as health care costs increase, mid-wage jobs disappear due to automation and outsourcing and college tuition mounts for those seeking to build credentials to get better work. In the meantime, more-affluent families have fared better in net worth because they are less dependent than lower-income groups on home property values, which remain shriveled after the housing bust. Wealthier Americans are more likely to be invested in the stock market, which as a whole has been quicker to recover from the downturn.