Risks Rise for Middle Class: Economic Security Continues to Fall

Publication Date: January 2007

Publisher: Center for American Progress

Author(s): Christian E. Weller

Research Area: Economics

Type: Report

Abstract:

Calculations based on newly released data sadly confirm that the financial security of middle class families further deteriorated in 2005. The trend towards a lot less financial security after 2001 was first highlighted by the Center for American Progress and the Service Employees International Union in a joint report released in September last year. Estimates based on new data on household wealth from the Federal Reserve and on health care trends from the Agency for Healthcare Research and Quality show that higher health care costs and rising indebtedness continue to weigh more and more heavily on middle class families.

Our earlier report, entitled Middle Class in Turmoil, found that all the gains made in financial security among middle class families in the 1990s had disappeared by early this century. (see chart: page one, full report ). The new data, which now encompasses all of 2005, confirms that four key measures of financial security continued to deteriorate for middle class families after 2004 (see table: page two, full report).