The Elusive Middle in America – What Has Happened to Middle-Class Income?

This paper by AARP Public Policy Institute’s Gary Koenig reports that the middle class today is smaller as well as older, more educated, more racially and ethnically diverse, and more likely to be single than middle-class households in the past. It notes that most Americans identify themselves as middle class and that “middle class” is not synonymous with “middle income.”  However, due to the broad availability of data on Americans’ income, researchers typically use income as an indicator of membership in the middle class.  The paper shows what it means to be “middle class” under three income-based definitions and analyzes economic trends affecting Americans in the middle income brackets

Significantly, this paper reports that from 1979 to 2007, average household income for the middle class grew about 16 percent – only one-third the growth for households with the highest income (whose income grew about 48 percent).  More recently, from 2000 to 2011, median household income fell 8 percent and was lower in 2011 than it was in 1997.