Who is middle class?
There is frequent reference to the middle class in discussions about the economy and certain kinds of public policy such as taxes. But who are we really talking about? Hard to say, says N.C. State University extension economist Mike Walden, because there’s not a standard definition for the middle class.
“In fact there is no official definition. I’ve heard some people say, well, anyone making less than $250,000 (a year) is middle class. If you did that definition you would include 95 percent of the households as middle class. But here’s maybe a way to think about it: If we look at the average, or median, household income today, it is around $50,000. That is, half the people — half the households — make more than $50,000; half of households make less than $50,000.
“So maybe if you take households earning between $25,000 and $100,000 and define that as middle class, what that gives you is 60 percent of the households in that range. That will leave 20 percent of households earning less than $25,000 — we would call those limited-resource households. And it would make 20 percent of the households earning more than $100,000 — we would call those upper-income people.
“So that’s maybe a working definition, but there are even problems with this, for example, because it doesn’t take into account the number of children or dependents. So this is really a very, very murky issue.”Category: Economic Perspective