This study divides the population in each country into five groups based on a family’s daily per capita consumption or income. The five groups are labeled poor, low income, middle income, upper-middle income, and high income. Of the four thresholds that separate these different income groups, two are especially important to keep in mind. The first is $2, the minimum daily per capita income that must be exceeded to exit poverty. The second is $10, the threshold that must be crossed to attain middle-income status. The thresholds are expressed in 2011 prices and 2011 purchasing power parities.
A middle-income threshold of $10 follows a practice that is gaining acceptance among economists. The same, or virtually the same, threshold has been applied by the World Bank (2007, 2015), researchers at the Organization for Economic Cooperation and Development (Kharas, 2010), the development community (Birdsall, 2010; Birdsall, Lustig and Meyer, 2013, and Dadush and Shaw, 2011) and the private sector (Court and Narasimhan, 2010). There is growing consensus that the $10 threshold, which is five times the poverty line used in this study, is associated with economic security and “insulates” people from falling back into poverty.
Middle Income or Middle Class
The terms “middle income” and “middle class” are often used interchangeably. This is especially true among economists who typically define the middle class in terms of income or consumption. But being middle class can connote more than income, be it a college education, white-collar work, economic security, owning a home, or having certain social and political values. Class could also be a state of mind, that is, it could be a matter of self-identification. The interplay among these many factors is examined in studies by Hout (2007) and Savage et al. (2013), among others.
This report uses income or consumption (depending on how data have been collected for a country) to group people. For that reason, the term “middle income” is used more often than not. However, “middle class” is also used, either to describe the overarching issue or to refer to work by other researchers.
The struggles of middle-class American families and growing income inequality have risen to the top of the national agenda. A new Stateline analysis shows that in all 50 states, the percentage of “middle-class” households—those making between 67 percent and 200 percent of the state’s median income—shrunk between 2000 and 2013. The change occurred even as … Continue reading
The American middle class is in trouble. The middle-class share of national income has fallen, middle-class wages are stagnant, and the middle class in the United States is no longer the world’s wealthiest. But income is only one side of the story. The cost of being in the middle class—and of maintaining a middle-class standard … Continue reading
The Census Bureau has been tracking median household income since 1967. America has endured seven recessions since then. The first five of those recessions saw a similar pattern when they ended: By the fifth year of recovery, median incomes had risen. This was true even for the recession that ended in 1980 – when the … Continue reading
A new US Census Bureau report shows that the median household’s net worth fell from $106,591 to $68,839 from 2005 to 2011: Chosen excerpts by Job Market Monitor. Read the whole story at Middle class households’ wealth fell 35 percent from 2005 to 2011 – Vox.
The purchasing power of the typical American family is 3.1 percent lower now than it was five years ago. No wonder people are unhappy about the economy! The benefits of rising levels of economic activity have simply not accrued to middle-income wage earners. Chosen excerpts by Job Market Monitor. Read the whole story at Why the Middle … Continue reading
As the Russell Sage Foundation points out, the slow housing recovery means that, in 2013, median households were still 36 percent poorer than they were a decade earlier. In fact, the housing bust was big enough to erase all the gains the middle class had made the past 30 years—and then some. As you can see below, … Continue reading
Eighty-five percent of the middle class say their standard of living is harder to maintain than it was a decade ago. This is due, in large part, to the fact that a middle class job often no longer supports a middle class life. Namely, their incomes have not kept pace with the costs of the … Continue reading
Canadians have little doubt that they face less financial stress about medical costs than Americans. Many also credit their labor unions for the size of their paychecks; union membership rates are higher in Canada. Canadians also know that the American housing bubble and bust were more severe than their version. via Life in Canada, Home … Continue reading
The American middle class, long the most affluent in the world, has lost that distinction. While the wealthiest Americans are outpacing many of their global peers, a New York Times analysis shows that across the lower- and middle-income tiers, citizens of other advanced countries have received considerably larger raises over the last three decades. After-tax … Continue reading
The increased wealth of highly skilled workers, the insane wealth of those with capital, and the outsourcing of lower skilled jobs have left us all asking, “what happened to the middle class?” Source: BestMSWPrograms.com Related articles The decline of middle-class workers / Job polarisation and wages Skills Gap – Middle-skill Workers – New England: … Continue reading
Muljoko, a 27-year-old cleaner who works in one of Jakarta’s gleaming office towers, has all the trappings of a newly minted member of the middle class. He owns a motorcycle, slings a Sony smartphone and has a futuristic-looking phone-watch strapped to his wrist that he uses to text friends during working hours. He is infinitely … Continue reading
Despite a slowly recovering economy, the proportion of Americans who identify themselves as middle class has dropped sharply in recent years. Today, about as many Americans identify themselves as lower or lower-middle class (40%) as say they are in the middle class (44%), according to a recent Pew Research Center/USA TODAY survey. Chosen excerpts by Job … Continue reading
“The meek shall inherit the earth” — that seems to be the latest message from the United Nations Development Program. Their 2013 Human Development Report chronicles the recent, rapid expansion of the middle class in the developing world. It also predicts that over the next two decades growth in the so-called “Global South” will dramatically … Continue reading
The geographical shift of the middle class has implications for supply chains says The Future of Manufacturing, A World Economic Forum Report in collaboration with Deloitte Touche Tohmatsu Limited The rise of demand centres in Asia, along with the typical costs that accompany more developed nations, will likely increase localization of production. Increasingly expensive logistics are leading some companies, such as … Continue reading