Millions Are Kissing the Middle Class Goodbye

Friday, 08 Mar 2013 07:56 AM

By John Morgan

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The recession is officially over, but so is middle-class status for many Americans, according to CNNMoney.

The nation’s median household income has actually declined by more than $4,000 since 2000, and the “typical trappings of middle-class life are slipping out of financial reach for many families,” CNNMoney said.

Economists are attributing the blame to two factors: jobs and wages.

Editor's Note: Startling Proof of the End of America’s Middle Class. Details in the Video

According to the National Employment Law Project, mid-wage work, such as that for office managers and truck drivers, added up to 60 percent of the job losses during the recession, but only 22 percent of the gains during the recovery.

Meanwhile, low-wage jobs have soared 58 percent.

The mortgage crisis “hollowed out” the middle class, Tamara Draut, vice president of policy and research at Demos, a public policy research group, told CNNMoney. Home prices are still 29 percent below their mid-2006 high.

Economists expect little improvement for the middle class for the time being.

“The middle class was always synonymous with economic security and stability,” Draut said. “Now it’s synonymous with economic anxiety.”

A Rutgers University survey showed many Americans share the bleak view of economists. More than 40 percent of those polled said they were “very concerned” about job security, only about one-third thought the economy would get better in 2014 and only 19 percent believed work opportunities would be better for the next generation.

Douglas Elmendorf, director of the Congressional Budget Office, had more bad news for the middle class this week, according to MarketWatch.

“Putting the debt on a sustainable path will ultimately require increases in taxes or cuts in government benefits or services for people who consider themselves to be in the middle class,” Elmendorf told the National Association for Business Economics.

According to a study by the Federal Reserve Bank of San Francisco, just four low-wage sectors now make up nearly 12 percent of the workforce as of 2011: retail sales, cashiers, office clerks, and food preparation and service workers, The Washington Post reported.

“These occupations are crucial to the support and growth of major industries across the country, but many of these workers do not earn enough to adequately support their families, even at a subsistence level,” the Fed study concluded.

Editor's Note: Startling Proof of the End of America’s Middle Class. Details in the Video

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