Yes, the America middle class is disappearing. 38% of US families were middle class in 1979 vs. 32% in 2014. But where did that 7% (6.8 percentage points to be exact) go? James Pethokoukis writes on American Enterprise Institute:
“Well, of the five income groups (poor, lower middle class, middle class, upper middle class, and rich) displayed, the bottom three got smaller, the top two bigger. The poor shrank by 4.5 percentage points, the lower middle class by 6.8, the middle class also by 6.8% But the upper middle class got a lot bigger, expanding by 16.4 points, and the rich by 1.8 points.”
Here is how upper middle class is defined, using research from economist Stephen Rose of the Urban Institute:
“Using Census Bureau data available through 2014, [Rose] defines the upper middle class as any household earning $100,000 to $350,000 for a family of three: at least double the U.S. median household income and about five times the poverty level. At the same time, they are quite distinct from the richest households. Instead of inheritors of dynastic wealth or the chief executives of large companies, they are likely middle-managers or professionals in business, law or medicine with bachelors and especially advanced degrees.”
Cool! I had always wondered if that wasn’t what was happening. My parents were middle class, I was upper middle class and my kids range from middle class(educator) to rich(doctor). It certainly felt to me that we weren’t destroying the middle class but they were leaving it behind to become wealthy!