The middle class is shrinking by some measures, and many households that consider themselves middle class are finding it harder to afford everyday expenses.
“We live in an aspirational society,” says Timothy Black, professor of sociology at Case Western Reserve University in Cleveland, Ohio. “Being middle class provides a particular type of status. You have made it into the American mainstream.”
While many Americans still identify as middle class, rising costs have made it harder for many households to achieve the financial security once associated with that status.
What Is the Middle Class?
There is no universal definition of the middle class. People may define it based on income, assets, occupation or a combination of those factors.
Income
The Pew Research Center defines middle-income households as those that earn two-thirds to double the U.S. median income for their household size.
The Transamerica Institute and Transamerica Center for Retirement Studies take a broader approach, defining the middle class as U.S. adults who live in households with annual incomes between $50,000 and $200,000. By this measure, more than half of U.S. adults are considered middle class.
Meanwhile, the Equifax Market Plus Index finds those in the group it calls the “pivoting middle” typically earn between $65,000 and $150,000, according to Jesse Hardin, senior advisor and economist at Equifax. Equifax estimates that 70% of Americans fall into this category based on anonymized credit, debt, income and asset data.
Assets
A steady paycheck alone may not provide financial stability when housing, healthcare and other essential costs continue to rise.
In fact, a 2026 Aspen Institute report found that nearly 3 of 4 U.S. households lack “essential wealth” — the level of assets needed to withstand financial shocks, build long-term financial security and pursue goals such as homeownership, retirement and education.
Having assets can provide a financial cushion and give households more options when facing unexpected expenses or economic uncertainty.
“Asset level has a huge bearing on how you’re navigating this economy,” Hardin says.
Job Status
While many people associate a stable career with middle-class status, job title alone doesn’t determine where someone falls economically. Income, assets and financial security often provide a more complete picture.
The terms working class and middle class are used interchangeably by some, but among those who make a distinction, the difference may hinge on job function. Those in the working class typically report to supervisors, while members of the middle class may be those supervisors, Black notes.
[Read: How Can I Build a Budget When My Paychecks Are Inconsistent?]
How the Economy Is Changing the Middle Class
The size of the middle class has changed significantly over time. The Pew Research Center also found that the share of U.S. adults living in middle-income households fell from 61% in 1971 to 51% in recent years, while the shares in both lower- and upper-income households increased.
Now, many people talk about the post-COVID-19 world as having a K-shaped economy. That refers to the fact that some people have seen their financial situations improve markedly in recent years, while others have fallen further behind. If this pattern continues, it could mean a smaller middle class in the years to come.
“I think the term middle class almost masks the struggle of the working middle class,” says Heather Black, vice president of 211 system strategy at United Way Worldwide. She says that since COVID-19, her organization has seen a shift in the number of people dialing 2-1-1 to request assistance referrals. People who had never called before were now in need of help.
Middle Class Is No Guarantee of Comfortable Living
The United Way uses the acronym ALICE — Asset Limited, Income Constrained, Employed — to describe some families who might seem to be in the middle class but do not actually make enough to cover all their basic needs.
“It’s not that people aren’t (working), but they are not able to keep up with the cost of living,” Black says. The United Way recorded 13 million interactions on its 211 line last year, which resulted in 19 million referrals. “What we find is that the top needs are the most basic of things.”
Housing, utilities and food assistance were the top requests from people calling 211. With the savings rate now half what it was in 2021, according to Hardin, families may find themselves with less money set aside to cover unexpected expenses.
“The reality is that the middle class is rapidly shifting,” Hardin says. He sees the K-shaped economy continuing to bisect those in the middle as households begin to move either up or down in economic status.
For many families, income alone no longer reflects financial security. Households may earn too much to qualify for government assistance yet still struggle to cover essential expenses, illustrating how the definition of the middle class extends beyond a paycheck.
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Are You Part of the Shrinking Middle Class? originally appeared on usnews.com
Update 07/30/26: This story was published at an earlier date and has been updated with new information.
