Decades Of Data Reveal A Steady Decline In America's Middle Class, According To Latest Research

Just fifty years ago, 61% of Americans formed the core of the middle class; today, they are barely the majority at 51%. 

According to a recent Pew Research Center analysis, in the same period, the percentage of Americans in lower-income households increased from 27% to 30%, and those in upper-income brackets rose from 11% to 19%. The data points to a growing income disparity, with the wealth of upper-income households increasing more rapidly than the middle and lower tiers.

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The Pew Research Center defines the middle class as households earning between two-thirds and twice the national median income, adjusted for household size. In today’s terms, for a family of three, that translates to a range of annual incomes from roughly $60,000 to $180,000, based on current median income figures. 

That said, as economic benchmarks have shifted, so too has the composition of the middle class. Over the past five decades, all income tiers have seen rises in median income, adjusted for inflation. 

However, the distribution of the gains has been uneven, creating a wider gap in income inequality.

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From 1970 to 2022, the median income of middle-class households increased by 60%, from about $66,400 to $106,100. In contrast, upper-income households saw their median income surge by 78%, from about $144,100 to $256,900. The lower-income households had the slowest growth rate, with their median income increasing by only 55%, from about $22,800 to $35,300.

In 2022, the median income of upper-income households was 7.3 times that of lower-income households, up from 6.3 times in 1970. Similarly, upper-income households earned 2.4 times the median income of middle-income households, a significant rise from 2.2 times in 1970.

These trends mark a structural shift in the economy, where growth gains are increasingly concentrated at the top. As a result, the share of total U.S. household income held by the middle class has decreased consistently each decade since 1970.

Middle-income households, which once held 62% of the aggregate income of all U.S. households, now hold only 43%. Conversely, the share of income held by upper-income households has increased from 29% to 48% over the same period.

Immigration also plays a role in the shrinking of the middle class.

According to the research, immigrants — who made up about 14% of the U.S. population in 2022 — were less likely than the U.S.-born to be in the middle class and more likely to live in lower-income households.

More than a third of immigrants (36%) lived in lower-income households, compared with 29% of the U.S.-born, the report noted.

The impact of the shifts is not uniform across all demographics within the middle class.

Certain groups, notably Black and Hispanic Americans, Native Hawaiians or Pacific Islanders, and American Indians or Alaska Natives, are more likely to find themselves on the lower end of the income spectrum within the middle class or even below it.

For example, in 2022, 39% to 47% of the named groups were classified in lower-income tiers.

According to the research, the economic mobility of these groups is often hindered by systemic barriers, including access to education, employment opportunities, and wealth accumulation. The entrenched nature of these barriers makes it challenging for many individuals within these communities to ascend to higher income tiers.

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