Infographic: Decline of the American Middle Class
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In the wake of the Great Recession, there is little doubt that the American middle class is in distress. From falling incomes to rising job insecurity, weak improvements in the American economy have flowed mainly to the small percentage of affluent households, leaving the middle class and the poor with declining standards of living.
In the wake of the Great Recession, there is little doubt that the American middle class is in distress. From falling incomes to rising job insecurity, weak improvements in the American economy have flowed mainly to the small percentage of affluent households, leaving the middle class and the poor with declining standards of living.
For the first time since the Great Depression, middle-class families – the 40 percent of households with annual incomes between $50,000 and $140,000 a year – have been losing ground for more than a decade and jobs that used to provide a secure grasp on middle class aims have transformed to low-wage ones. Official data also shows that the net worth of the middle fifth of American household plunged by 26 percent between 2008 and 2007, after growing an average of 2.4 percent a year from 2001 and 2007.
According to a report by the Wall Street Journal, the squeeze on the middle class is so severe that companies such as P&G are cutting on marketing to the disappearing middle class, selling more instead to either high-income or low-income consumers and abandoning the middle.
P&G is not the only company adjusting to America’s economic and demographic change. Other big firms, like Heinz, are following suit. Researchers and analysts are starting to pay attention to what they call the Consumer Hourglass Theory, termed so because it denotes a society that bulges at the top and bottom and is squeezed in the middle.
Take a look at this infographic that provides evidence for the decline of the middle class in America. It features the latest Pew and Census data dating back to the 70’s, which explains the decline in both size and income.
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