The American middle class is shrinking in dramatic ways, a trend that could have a profound impact on the 2016 presidential election — and one that offers a road map for how Donald Trump might upset Hillary Clinton.
In December, Pew Research Center detailed how adults in middle-income households no longer comprise a majority of the country. In 2015, just 43 percent were in the middle-income tier, compared with 62 percent in 1970. But this month’s follow-up report described how that contraction has been far from uniform across the country. The middle class is shrinking in some parts of the country because more people are richer, while in other regions, it is due to a surge in lower-income earners.
Using Census Bureau data from 229 metropolitan areas, Pew found that 203 areas experienced a decrease in the share of adults living in middle-income households from 2000 to 2014 — nearly 90 percent of the metro regions examined. In 160 areas, the share of adults in the lower-income tier went up, while 172 areas saw an increase in the upper-income tier. There is overlap, because some metro areas went in both directions — a shrinking middle-income tier as a result of increases in both lower-income and upper-income earners.
The metro areas included in the Pew study make up 76 percent of the nation’s population. Pew defined middle income as falling between two-thirds and double the national median, after adjusting for household size. So in 2014, a middle-income family of four earned $48,083 to $144,251.
Pew did not assess the political impact of the income trends, but the potential fallout is clear in examining the geographic breakdown of the metro area winners and losers, as well as those that are treading water. The 10 metro areas with the largest concentrations of upper-income earners are clustered in California and Northeastern states that have, for the most part, not been competitive in recent presidential elections.
Likewise, California, Arizona, New Mexico, and Texas have the 10 areas with the highest share of lower-income earners. With the exception of New Mexico, all those states have favored either Republicans or Democrats in four straight presidential elections.
The metro regions with the highest percentage of middle-income households, though, are disproportionately located in swing states or states that the Trump campaign believes are ripe for the New York billionaire’s economic message. Pennsylvania and Ohio each have one, and Wisconsin alone has four.
“That tells me the trends described in this report are going to benefit the more populist candidates,” said Alan Tonelson, an economic policy analyst who is critical of U.S. trade policy. “That seems to me to translate into good news for Trump … [Clinton] doesn’t have very deep roots as a trade policy critic.”
Even in Midwestern areas with the highest percentage of middle-income earners, manufacturing losses in some places prompted a decrease in the upper-income tier, which Pew suggests could mean the middle class is not on solid ground.
The economic recovery has been painfully slow since the end of the last recession. According to Pew, the median income of U.S. households in 2014 was still 8 percent less than in 1999 and fell in 190 of 229 metro areas. Middle-income households lost ground in 222 of 229 metro areas during that time period, falling 6 percent. Income, in fact, declined in all tiers — with the national median by 10 percent in the lower tier and 7 percent in the upper tier.
Clinton’s challenge is to address the concerns of voters who feel they have been left behind while at the same time defending the president’s record. Justin Holmes, a political science professor a the University of Northern Iowa, noted that the presumptive nominee recently said that she would put her husband in charge of “revitalizing the economy” if elected.
“That is, perhaps, putting a little bit of distance between herself and Obama … Certainly, it’s going to be a bit of a balancing act,” he said.
The Pew report shows that the 10 biggest winners, disproportionately located in areas that have benefited from a boom in domestic energy production, are mostly in states that are non-competitive politically. Only one — the Grand Junction, Colorado, area — is in a state that has alternated between the parties in recent elections. Tonelson said the result is that Clinton is unlikely to capitalize on the improved economic prospects in those areas.
On the other hand, the list of the biggest losers is rife with opportunities for Trump to make the case that Obama’s policies have failed. Springfield, Ohio, is tied for the metro region that has seen the biggest hit to economic status. The share of upper-income earners minus the share of lower-income earners has declined by 16 percentage points since 2014.
Mansfield, Ohio, is also on that list, giving the crucial swing state two of the 10 metro areas that lost the most from 2000 to 2014. North Carolina, which Obama won in 2008 and lost narrowly in 2012, has three metro areas on the list. Michigan, a blue state whose economic distress leads some to think Trump could turn it red, has two metro areas on that list.
“Trump has some messaging there … that I think really does speak to those anxieties,” Holmes said. “Some of these things that people are anxious about, some of those trade deals … came in under Bill Clinton.”