After years of declines, America’s middle class now holds a smaller share of U.S. wealth than the top 1%. The middle 60% of U.S. households by income — a measure economists often use as a definition of the middle class — saw their combined assets drop to 26.6% of national wealth as of June, the lowest in Federal Reserve data going back three decades. For the first time, the super rich had a bigger share, at 27%. The data offer a window into the slow-motion erosion in the financial security of mid-tier earners that has fueled voters’ discontent in recent years. That continued through the Covid-19 pandemic, despite trillions of dollars in government relief. While “middle class” has different meanings to different people, many economists use income to define the group. The 77.5 million families in the middle 60% make about $27,000 to $141,000 annually, based on Census Bureau data. Their share in three main categories of assets — real estate, equities and private businesses — slumped in one generation. That made their lives more precarious, with fewer financial reserves to fall back on when they lose their jobs. The top 1% represents about 1.3 million households who roughly make more than $500,000 a year — out of a total of almost 130 million. The concentration of wealth in the hands of a fraction of the population is at the core of some of the country’s major political battles.
Categories: Economics/Class Relations