America’s hidden underclass: 62% of jobs DON’T pay to enough to support a middle-class lifestyle

While the unemployment rate in the U.S. has fallen to a record low of 3.7 percent, a majority of American jobs don’t pay enough to offset cost of living and make middle class living possible, according to a new study.

When wages are weighed against the cost of living in the largest 204 metropolitan regions across the nation, 62 percent of jobs don’t pay enough for a dual-income household with children to meet the definition of ‘middle class,’ according to a new ‘Opportunity Index’ developed by Third Way, a Washington D.C.-based think tank.

‘We were shocked to find out it’s only 38 percent of people who get the middle class life or better,’ said Ryan Bhandari, a policy advisor for Third Way, in an interview with DailyMail.com.

‘What are people getting out of their jobs?’ he added. ‘Not just how much it pays, but how far does it take you in a given (geographic) area and can you live that middle class life?’ 

Fayetteville, North Carolina ranked last with the lowest opportunity score in the nation, with just 35 percent of jobs paying at least $40,846 – the threshold for entry to the middle class in that region. In addition, the area’s employment-to-population ratio is well below the national average of 75 percent.

This chart illustrates the U.S. cities that have the smallest share of jobs that qualify as middle class or better

This chart illustrates the U.S. cities that have the smallest share of jobs that qualify as middle class or better

This chart illustrates the U.S. cities that have the smallest share of jobs that qualify as middle class or better

At the other end of the spectrum, Rochester, Minnesota has the most opportunity for upward mobility in the nation, with 45 percent of jobs considered middle class or better, and nearly 85 percent of its working-age people are employed.

Among major U.S. cities, New York, Los Angeles and San Francisco were ranked toward the bottom of the Opportunity Index (168, 172 and 174, respectively), largely due to their high cost-of-living.

Researchers found that true opportunity is scarce in America, with just 23 percent of jobs qualifying as middle class and 15 percent qualifying as professional positions.

Furthermore, 30 percent of jobs in America are considered ‘hardship’ positions – or jobs that don’t pay enough for a single, childless adult to support a basic standard of living, paying an average of less than $26,452.

The largest share (32 percent) were living-wage jobs, which pay enough for a worker to survive, but not enough for a middle class lifestyle.

Kristen Alessi, a 49-year-old corporate travel agent from Quincy, Massachusetts, said she wasn’t surprised that the majority of the country doesn’t make the middle class cut.

‘My husband and I both work full time and we pay $1,350 for a very small apartment,’ she told DailyMail.com. ‘With heat and gas, electric and cable and everything else, it gets really expensive really quickly. We both make well over $60,000 a year, but we still don’t really find it easy to make ends meet.’

She and her husband tend to avoid eating out in restaurants and other splurges to ensure they have enough to pay the bills.

‘It’s super frustrating,’ Alessi said. ‘I work as much overtime as I possibly can just to make everything work out.’ 

Alessi isn’t alone. The problem is that jobs in much of the country don’t pay enough to offset rising housing costs and basic living expenses.

For example, a worker in San Francisco – one of the most expensive housing markets in the country – must make a minimum of $82,142 to achieve a middle class lifestyle.

By comparison, workers in Cedar Rapids, Iowa can achieve middle class status in a job paying $40,046 or more per year.

This chart illustrates the U.S. cities that have the largest share of jobs that qualify as middle class or better

This chart illustrates the U.S. cities that have the largest share of jobs that qualify as middle class or better

This chart illustrates the U.S. cities that have the largest share of jobs that qualify as middle class or better

While the Pew Research Center reports that just over half (52 percent) of Americans live in middle class households, that’s based on static, or universal income tiers that aren’t adapted for differing costs of living across the country.

Researchers at Third Way said that many Americans are making sacrifices as they try to survive and even get ahead – including living in modest housing, skipping vacations, or delaying saving for retirement and emergencies. 

To reach those conclusions, experts at the left-leaning think tank used federal labor and Census data to weigh job quality (defined as how much a job pays and the purchasing power it provides in a specific region) against job quantity (measured by each metropolitan area’s prime-age employment-to-population ratio).

Their work covered all metropolitan areas with at least 100,000 employed workers – which captures 73 percent of the U.S. workforce and omits those in the country’s most rural regions.

Bhandari said researchers thought about the values and lifestyle that Americans assign to the concept of a middle class life – things like having money for vacations, savings, meals out and being able to afford health insurance.

‘We took all that information and created our conception of a middle class job (and pay) that we think matches up pretty well with what American people want,’ Bhandari said.

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