Oct 31, 2018

Study: American jobs aren't supporting middle class life

People walking through Times Square, New York City. Photo: Spencer Platt/Getty Images

Most Americans are unable to live a middle-class lifestyle, despite being employed, because their salaries won't support it, according to a new study published in Third Way by authors Ryan Bhandari and David Brown.

Why it matters: American unemployment has reached a 49-year low at 3.7%, but wages are still an issue for most Americans, the study says, with 62% of jobs falling short of middle-class standards because of wages and the cost of living in areas where jobs are located.

"It's not about how many jobs are open or how many people have jobs, but it's about how good those jobs are."
— Ryan Bhandari, economic policy adviser for Third Way

Methodology: The study created an Opportunity Index that measured the opportunity to "earn a good life" in metropolitan statistical areas where total employment is at least 100,000.

The study covered a total of 204 metropolitan areas and 73% of the workers in the U.S., omitting the workforce in the rural parts of the country.

The index considered two factors: Job quality — by how much the job pays — and job quantity — by the employment-to-population ratio.

By the numbers:

  • Only 23% of jobs afford Americans a middle-class living.
  • 15% of jobs provide Americans with high-earning professional wages paying over $80,000.
  • 30% of jobs in the country pay Americans a "hardship" wage, which is "less than what a single adult living on his or her own needs for basic necessities" the study says, paying less than $27,000.

About half of Americans live in households with middle-class salaries. But 40% can't afford middle-class basic necessities because of ordinary expenses like child care, rent and cellphone coverage.

For example, according to Bhandari, in San Francisco, the median wage is $57,000, but the threshold the study has for middle-class affordability is at $82,000. "A family of four needs $162,000 for a middle-class life."

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  1. Global: Total confirmed cases as of 7 p.m. ET: 932,605 — Total deaths: 46,809 — Total recoveries: 193,177Map.
  2. U.S.: Total confirmed cases as of 7 p.m. ET: 213,372 — Total deaths: 4,757 — Total recoveries: 8,474Map.
  3. Business updates: Very small businesses are bearing the brunt of the coronavirus job crisis.
  4. World update: Spain’s confirmed cases surpassed 100,000, and the nation saw its biggest daily death toll so far. More than 500 people were reported dead within the last 24 hours in the U.K., per Johns Hopkins.
  5. State updates: Florida and Pennsylvania are the latest states to issue stay-at-home orders — Michigan has more than 9,000 confirmed cases, an increase of 1,200 and 78 new deaths in 24 hours.
  6. Stock market updates: Stocks closed more than 4% lower on Wednesday, continuing a volatile stretch for the stock market amid the coronavirus outbreak.
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World coronavirus updates: Spain's health care system overloaded

Data: The Center for Systems Science and Engineering at Johns Hopkins, the CDC, and China's Health Ministry. Note: China numbers are for the mainland only and U.S. numbers include repatriated citizens and confirmed plus presumptive cases from the CDC

Two planes with protective equipment arrived to restock Spain’s overloaded public health system on Wednesday as confirmed cases surpassed 100,000 and the nation saw its biggest death toll so far, Reuters reports.

The big picture: COVID-19 cases surged past 900,000 and the global death toll surpassed 45,000 early Wednesday, per Johns Hopkins data. Italy has reported more than 12,000 deaths.

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