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Wednesday, February 29, 2012

The middle class? Not what it used to be.

Income? Lifestyle? Investments? Toys? The definition varies by who you ask and who you think or feel you are...


The middle class in the United States isn't what it used to be. A big dividing line? Education.
Jeremy Hobson: So do you consider yourself middle class? Well, the definition of that term is what we'll explore now as we launch our new Wealth and Poverty Desk.
It used to be middle class meant "doing well" -- realizing the American Dream. Well, as Mitchell Hartman reports, it's more complicated now.

Mitchell Hartman: A lot of Americans think of themselves as middle class. My family does. We arrived more than a century ago in Philadelphia with the proverbial "clothes on our backs," delivered bread and sewed men’s suits. A couple generations later, we were teachers, accountants and cardiologists.

I dialed up my first cousin, Marcy Tanter. She teaches English at a state college near Fort Worth, Texas.
Hartman: Are you middle class?

Marcy Tanter: Yes, and I think for the most part our family is. Pretty much everybody has a college education, everybody has jobs. We travel. We have computers and iPads and iPods and cars.
We’re lucky to be in the upper-middle-class sweet spot, with incomes in the top 25 percent. We’ll be able to help our kids -- with SAT classes, college costs or a first home.

Some of our relatives haven’t made out as well. They didn’t go to college, and have worked in real estate, construction, waitressing, selling auto parts. In the Great Recession, a few have lost homes or gone bankrupt.

Welcome to America’s struggling middle, says University of Wisconsin economist Timothy Smeeding. It’s people making around the median income: $50,000 a year. Households around $80,000 to $120,000, depending on geography.
Timothy Smeeding: And this group is still middle class. But 10 years ago, they were behind the white picket fence, they had a nice house and steady jobs, and their kids would do better than they would. And now they’re finding a lot of that crumbling.
Smeeding says with the increased computerization of manufacturing and secretarial work, people with less education have limited long-term prospects.
Smeeding: What’s left to them are personal services: cashiers, sales clerks, lawns, food preparation. Those jobs don’t pay a lot of money, so the traditional avenues to the middle class are gone. At the same time, people with higher education, particularly post-graduate degrees, are doing really well.
So, what’s the middle class? Well, there isn’t just one. There are two, and they’re pulling apart. Get higher education or technical training, chances are you’ll do pretty well. Miss out on post-high-school education, end up working jobs that require few advanced skills, and you could find your family squeezed out of the middle class, altogether.

I’m Mitchell Hartman for Marketplace.

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About the author

Mitchell Hartman is the senior reporter for Marketplace’s entrepreneurship desk and also covers employment. Follow Mitchell on Twitter @entrepreneurguy

4 comments:

Anonymous said...

It's absolutely true. That is part of the reason I'm trying to finish at least my BA. While I already work in the tech industry in the Job I love, if I want any more or to continue to be a viable prospect for employment I absolutely need the piece of paper that says I have my "traditional" education.

Guess I'm part of the few that are lucky, for now.

Anonymous said...

Interesting points about the "middle class." I always thought my immediate family was middle class and I can relate now that some are not. My younger sister is not and I try to explain to her that she should do more with her children so they could go to college but seems content on where she is at. BUT expects me to make sure I send $$$ to the kids for special occasion because I am considered the "rich aunt." Not true.

Anita Falconetti
Comm 101-4049

Anonymous said...

I can agree with most of what was said in this article. Before our economy crumbled, people were finding high paying jobs just fine, but now that there are more people out of work there is a higher level of competition amongst awaiting applicants. Employers are then able to pick the best of the best. which usually means that the people who have education and experiance are being chosen. Our country is heading back into a place where education is important again. That's my opinion why our view on middle class is changing.

Chris Smith com101 sec4049

Anonymous said...

Employers are not hiring the best. They are hiring the cheapest and hiring those who are like them.

Age, sex, ethnic, religious belief and race descrimination are all there...try being over 40 and landing a job that pays near what you use to make. Try being over 50. Women were gaining ground in pay but are now facing pay cuts just because they are women. Muslim, athiests,Catholics and others also find job hunting more difficult because of their look or beliefs. We have a larger percentage of our highly educated unemployed than at any other time in our history.