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Hanging On: A Pressured Middle Class In Economic Recovery


The recession in this country is long over. The economy has recovered. So why does it still feel so shaky?


MARTIN: The labor market is gaining jobs. That's a fact. But income inequality is growing. And this economic anxiety, decades of lost manufacturing jobs and ever-shrinking middle class, all these issues are driving the political conversation right now and shaping the course of the 2016 presidential race. So every week up until the November election, we're going to talk about the increasing pressures on the middle class. It's a series we're calling Hanging On.


MARTIN: And today, we're going to get into the big picture with Derek Thompson. He's a senior editor at The Atlantic where he writes about the economy. He joins me now from our studios in New York. Hey, Derek, thanks for being with us.

DEREK THOMPSON: Hey, it's a pleasure to be here.

MARTIN: As someone who studies the economy, writes about the economy and these issues, how do you define the middle class?

THOMPSON: When I think of middle class, I think of the median household between $50,000 and $55,000.

MARTIN: OK, so before we dig into the pressure that we know exists on the middle class, let's talk about a little good news because there have been 73 straight months of job growth in the private sector in this country, which is huge. It sounds huge. Can you explain what's behind that?

THOMPSON: Sure. It's a really big thing. That is the most consecutive months of private sector job growth in American history, and that's fantastic. But what has to be taken into consideration are two other things. First, you have to think about where we're coming from. We're coming from one of the worst recessions in the last century. Second, you have to look at the kind of jobs that are being created. And there's a significant amount of evidence that a lot of the jobs that have been added in the last six years have been lower wage jobs.

MARTIN: So when we think about who has benefited from the recovery, are you saying that people who fall into the category who would work for - in these lower wage jobs, those people have benefited from the upswing?

THOMPSON: If the metric is more jobs, basically every single demographic you can think of has benefited in the last six, seven years. Jobs have grown for the poor, they've grown for the middle class, they've grown for the rich as well. The problem, however, the challenge is, all right, what kind of jobs are those? Well, often they're lower paying service sector jobs. Maybe they're retail jobs, cashier jobs, even home health aid-type work, which is notably often independent, so it's not given sort of employer subsidized health care. So this is work and any work is good, but a lot of it has been either low-paid or it's come often without the sort of array of benefits that we're used to expecting with work, whether that's employer subsidized health insurance or retirement packages.

MARTIN: So let's talk about the people who have been losing out or who have at least felt like they're losing out because I imagine those answers - those groups of people are different.

THOMPSON: Yeah, I think I like the way that you framed that. I think that right now it's important to know that if you live in a city, you are surrounded by considerable growth relative to the rest of the country. New York, San Francisco, Seattle, Austin - these sort of cities are bustling. Young people graduating from elite colleges are moving there. They're doing really well.

But there's a part of the country that's not doing quite so well and hasn't done so well in the last decade and perhaps even longer, and that's this Rust Belt in Appalachia. And if you look at some of the demographics of, for example, Donald Trump supporters, they often live in this part of the country. They didn't go to college. They feel like they don't have a political or economic voice, that they've missed out on this recovery. And so I do think that this economic and political story is intertwined.

MARTIN: But you say they feel like they've missed out on the recovery, but they actually have, right? They've - many of them anyway come from these places that have seen all these jobs shipped overseas. So when a candidate, be it Donald Trump or Bernie Sanders, talks about the perils of globalization, that means something to them in a very real way.

THOMPSON: Absolutely. And I think - you know, one way that I think about the appeal of revolutionary or outside-the-box candidates, there's an interesting theory from sociology called the Revolution of Rising Expectations, which is this idea that if you looks at revolutions throughout world history - the French Revolution, the Russian Revolution - the places, the pockets of revolutionary spirit, it wasn't those in abject poverty. It also wasn't those obviously who were aristocrats. It tended to be the middle class that recently felt shocked by some change in their - in reality relative to expectation. They thought things were going to keep getting better and then they didn't.

And so this theory of the Revolution of Rising Expectations essentially says that sometimes revolutions come not because things are in the absolute so much worse than they used to be 40 years ago, but because reality isn't catching up with expectations. And certainly something that you see here with the Rust Belt, with Appalachia, is a part of the country that in the middle of the 20th century was absolutely going gangbusters. I mean, Youngstown and Flint, these were two of the richest cities not only in the country, perhaps in the world. And right now they are examples of cities that in the last 30 years have been essentially abandoned, both by their residents and by politics. So I do think that it's important to not only look at the numbers but also look at how the numbers compare to how people might have expected their lives to go, looking from the vantage point in the 1960s, 1970s.

MARTIN: Derek Thompson covers the economy for The Atlantic. Derek, thanks so much for talking with us.

THOMPSON: Thank you. Transcript provided by NPR, Copyright NPR.