Special Report

States Where the Middle Class Is Dying

10. Arkansas
> Middle income growth 2010-2014:
> Fifth quintile income growth 2010-2014: 3.7% (23rd highest)
> Fifth quintile share of income: 50.8% (13th highest)
> Middle class household income: $41,581 (3rd lowest)

Middle class households earn roughly $41,600 in Arkansas, over $300 less than in 2010 and nearly $13,000 less than middle class households across the country. As in most of the nation, even as income of middle class households declined, income among Arkansas’ highest 20% of households grew. Average incomes in the highest quintile grew by 3.7% to $146,449 over the same time period. Within the highest group of earners, income gains were even more dramatic among the top 5% of households, with earnings growing 10.3% since 2010, the eighth highest increase in the country over that time. A weak job market may help explain the decline in incomes of the state’s middle earners. The state’s unemployment rate fell to 6.1% from a high of 8.2% in 2010, largely due to a nearly 4% contraction in Arkansas’s labor force.

9. New York
> Middle income growth 2010-2014:
> Fifth quintile income growth 2010-2014: 2.9% (23rd lowest)
> Fifth quintile share of income: 54.0% (the highest)
> Middle class household income: $58,923 (15th highest)

Income inequality in New York is the worst in the country. The bottom 20% of households account for just 2.6% of all income in the state, the least in the nation. Conversely, the top 20% of households account for 54% of all income, the most in the nation. Further, New York is one of only two states, along with Connecticut, where more than 25% of all income was earned by just the top 5% of households from 2010 through 2014. Despite the chasm between rich and poor, nearly one quarter of public and private workers are part of a union, the highest in the country and an indication of middle class health. Nationwide, just 11.1% of workers are union members.

8. Montana
> Middle income growth 2010-2014:
> Fifth quintile income growth 2010-2014: 5.2% (16th highest)
> Fifth quintile share of income: 49.2% (18th lowest)
> Middle class household income: $46,442 (10th lowest)

One of just a handful of states in the country without a sales tax, Montana’s relatively progressive tax climate is perhaps more favorable to middle class households. The state’s Gini coefficient is among the lowest in the country, and the unemployment rate has tracked roughly 2 percentage points below the national rate since 2010, even as the state’s labor force increased sharply. Middle class incomes, however, have not fared as well, shrinking 1.1% over the five years ending in 2014. Over the same period, household incomes of the top 20% increased 5.2%, one of the larger increases in the country. In 2015, a study by Pew Charitable Trusts, a nonprofit think tank, found that middle class incomes in the state fell significantly more than other Western states from 2000 through 2013.

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