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What Does the Data Say?
The majority of the U.S. population (52%) is in the middle class, according to the latest report (September 2018) from the Pew Research Center. That is a slight increase from 2015, when the previous Pew report found that the middle class made up 50% of the U.S. population. However, the narrow majority found in 2018 still reflects a longer-term trend of a shrinking middle class compared to the 1970s, 1980s, 1990s, and 2000s.
Pew’s previous report from 2015 showed that (as noted above) for the first time since at least the 1960s, the majority of Americans were not in the middle class. In 2015, just 50% of American adults lived in middle-income households—down from 54% in 2001, 59% in 1981, and 61% in 1971. It also found that the share of income going to middle-income households fell from 62% in 1970 to 43% in 2014. The middle class has been both decreasing in population share and seeing its cut of the income pie shrink.
2-person family middle-class income range: $42,360 to $126,4483-person family middle-class income range: $49,472 to $147,6784-person family middle-class income range: $58,007 to $173,156
Which Income Classes Are Growing?
Both poorer and richer income classes have increased in size in recent decades. Since 1971, the number of the lowest-income earners, who make less than two-thirds of the U.S. median income, grew from 16% to 20% of the population. At the same time, the percentage of Americans in the highest-income households also rose—from 4% to 9% of the population.
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Median household income: $102,486
The median household income in Seattle is $102,486. Thus, the middle-class income range is $76,864.50 to $204,972. For families, the median is $130,685 and for married couples, it is $151,887. While Seattle has the second-highest median income, it has the fourth-highest middle-class income growth.
We conducted a separate analysis on what it takes to be “rich” in different cities, which we defined as being in the top 20% and the top 5% of earners in your city. In Seattle, the average for those two rankings is $331,167 and $583,249, respectively. In other words, someone at the top end of the middle-class income range still makes over 50% less than the average for the top 20% of earners.
Average American Income by State
Where you live matters when it comes to income, to help understand the variations in income between different states, we’ve created a chart showing the average and median household income in each state:
Median household income: $79,018
Boston has the sixth-highest median income in the nation, though its median is noticeably less than that of D.C. The median income there puts its middle-class range at between $59,263.50 and $158,036. For married couples, the median income is $126,595 versus $82,363 for families.
Like other cities, in Boston, the top 20% of earners make an average that is roughly double the highest middle-class earners. The average for the top 20% here is $299,047. And in the top 5%, the average is $563,610, a number that is more than seven times the median income for the city.
Poverty in America Statistics
Despite being the sixth highest income country in the world, there are still millions of Americans who struggle with poverty. For these individuals, the average income is a far cry from what they’ve come to expect. Here’s what we found:
As of 2020, 11.4% of Americans lived below the poverty line.
Which is a whole percentage point higher than it was in 2019. No doubt, this spike in poverty can be partially attributed to the effects of the COVID-19 Pandemic.
There are approximately 37.2 million Americans living in poverty.
With Califonia accounting for over 12% of those numbers, with 5,163,814 living in poverty in the state.
The poverty rate for households in the U.S. is 4.7%.
Which is an increase of 0.7% from 2019, when the rate was only 4%. That’s around 7.3 million poor families living in the United States.
From 2010 to 2019, the poverty rate steadily dropped from 15.1% to 10.5%.
However, there was a sharp uptick in the poverty rate from 2019-2020, when it increased to 11.4%. These ups and downs aren’t unusual, though, as the poverty rate in 2000 was only 11.3%.
Under the current class classifications, two individuals who are part of the middle class might not have much in common from an economic standpoint. Once we consider location, education, occupation, how far apart two people are in the middle-income bracket, and who they know, two “middle class” individuals can have widely different economic experiences.
Does the current income framework provide value on where a person fits in society? Let us know what you think by writing to email@example.com.
How Middle-Class Income Works
The Census Bureau estimated that there were about 130 million households in the United States in 2020. They can be divided into groups that correspond to the Pew definitions of the middle class.
The lowest income groups are within range of the federal poverty level. As of 2021, the federal poverty level ranges from $12,880 for one person to $44,660 for a household of eight.
The highest income groups roughly correspond to the highest tax brackets for the tax year 2021. These include individuals earning over $523,600, married couples earning more than $628,300, and heads of household earning over $523,600. (For 2022, they'll include singles making more than $539,900, married couples making more than $647,850, and heads of household making more than $539,900.)
This chart shows the breakdown of 2020 income levels using Census data:
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