Pew study sees shrinking middle class in US cities

Associated Press

WASHINGTON

In cities across America, the middle class is hollowing out.

A widening wealth gap is moving more households into either higher- or lower-income groups in major metro areas, with fewer remaining in the middle, according to a report released Wednesday by the Pew Research Center.

In nearly one-quarter of metro areas, middle-class adults no longer make up a majority, the Pew analysis found. That’s up from fewer than 10 percent of metro areas in 2000.

Pew defines the middle class as households with incomes between two-thirds of median income and twice the median, adjusted for household size and the local cost of living. The median is midway between richest and poorest. By Pew’s definition, a three-person household was middle class in 2014 if its annual income fell between $42,000 and $125,000.

Middle-class adults now make up less than half the population in such cities as New York, Los Angeles, Boston and Houston.

That sharp shift reflects a broader erosion that occurred from 2000 through 2014. Over that time, the middle class shrank in nine out of every 10 metro areas, Pew found.

“The shrinking of the American middle class is a pervasive phenomenon,” said Rakesh Kochhar, associate research director for Pew and the lead author of the report. “It has increased the polarization in incomes.”

Even many of the cities with substantial middle-class populations still are under stress, according to Pew’s research. For example, Wausau, Wis., and Youngstown-Warren, Ohio, are among the cities with the largest proportions of adults in middle-class homes, at 67.2 percent and 60.2 percent, respectively.

Yet median incomes have fallen sharply in both cities. They fell 8.5 percent in Wausau and 12.9 percent in Youngstown, Pew found. That compares with an 8 percent drop from 2000 to 2014 nationwide.

In addition, both cities have seen their lower-income population shares grow, while upper-incomes shrank.