"Whither the Middle Class'? A Dynamic View"

Research using cross-sectional survey 'snapshots' of household income taken over the past quarter century reveals a growing inequality in the distribution of annual money income of households in the United States (Thurow, 1987; Levy, 1987; Levy and Michel, 1991; Michel, 1991; Karoly, 1990; Center on Budget and Policy Priorities, 1990; Easterlin, MacDonald and Macunovich, 1990), prompting some to argue that the U.S. middle class is disappearing (Phillips, 1990; Bradbury, 1986). Aggregate data from the National Accounts and from wealth surveys (Wolff, 1989; Eargle, 1991) reinforce this conclusion by showing a growing share of income from capital, a falling share for earnings, and a slightly increasing concentration of wealth among upper-income groups. Also well-documented is greater inequality in the size distribution of earnings and wages in the late 1980s as compared to one or two decades before (GottschaLk and Danziger, 1989; Burtless, 1989; Blackbum et al., this volume). Despite the consistency of these results, their almost universal reliance on data drawn from cross-sectional snapshots leaves unanswered many important questions regarding the nature of the changes taking place in the distribution of income and wealth. Most importantly, cross-sectional snapshots provide information only on net changes in economic position and thus reveal little about the extent and nature of movement into and out of the middle class.. Are increasing numbers of families 'falling from grace', as Katherine Newman (1988) puts it? If so, who are they and what events are linked to their income losses? Or is mobility into the middle class declining? And, if so, does this affect in particular young families? What avenues for upward mobility are disappearing? These are the types of questions we seek to address for adults crossing either the lower or the upper boundary of the middle class. A second set of issues we address involves linkages between changes in income and changes in wealth. We analyze trends in the transitions of prime age (25-54 years old) adults into and out of the middle class using 22 years of data from the Panel Study of Income Dynamics. We begin by reviewing the methodology and measurement procedures that we employ to define the middle class and transitions into and out of middle-class status. Next we present our basic findings which, in fact, show a persistent 'withering' of the middle class since about 1980. We then search for clues as to who moved into and out of the middle-income groups and the source of such changes. Because notions of 'class' are usually based on measures of wealth as well as income, we also investigate longitudinal changes in the wealth distribution in the 1980s for these same individuals. Our findings on wealth reinforce those based on income. The paper concludes with a brief discussion of the policy implications of our findings.

Measurement Error In Cross-Sectional and Longitudinal Labor Market Surveys: Results From Two Validation Studies

This paper reports evidence on the error properties of survey reports of labor market variables such as earnings and work hours. Our primary data source is the PSID Validation Study, a two-wave panel survey of a sample of workers employed by a large firm which also allowed us access to its very detailed records of its workers earnings. etc. The second data source uses individuals' 1977 and 1978 (March Current Population Survey) reports of earnings, matched to Social Security earnings records. In both data sets, individuals: reports of earnings are fairly accurately reported, and the errors are negatively related to true earnings. The latter property reduces the bias due to measurement error when earnings are used as an independent variable, but (unlike the classical-error case) leads to some bias when earnings are the dependent variable. Measurement-error-induced biases when change in earnings is the variable of interest are larger, but not dramatically so. Various measures of hourly earnings were much less reliable than annual earnings. Retrospective reports of unemployment showed considerable under-reporting, even of long spells.

W(h)ither the Middle Class? A Dynamic View

A constant theme throughout the history of the U.S. has been the growth of the middle class and the promise of its growth for the elimination of poverty. By the late 1980s, social analysts sensed a decline in the size of the American middle class which later was verified through cross-section analysis of wage and salary and income distribution data. Using time series from the Panel Study of Income Dynamics for prime-age males, this study moves beyond verification of the shrinking of the middle class. The analysis examines changes in both income and wealth and finds that wealth increases reinforced income changes at the upper end of the distribution while for low-income households, real earnings have stagnated. The analysis also finds that demographics and cyclical factors account for little of the shrinkage of the middle class, although, cyclical factors in the late 1980s reduced the upward mobility of lower-income households and increased the downward mobility of many in the lower range of the middle of the income distribution. This coupled with the gains to upper income households generated by the 1986 Federal Tax Reform enlarged the number of households at both ends of the income distribution at the expense of the middle class. Moreover, the authors find that prime-age adults who began the 1980s in the middle-income category had a greater probability of falling to the lower class than of rising to the upper class

Effects of Maternal Employment and Prematurity on Child Outcomes in Single Parent Families

Background Effects of maternal employment for preschool children vary based on specific characteristics of the mother’s employment, the family’s economic status, and the mother’s attitudes about employment. However, there is limited research on a growing group of children at developmental risk—those born prematurely and living in a single-parent family. Objective To examine the effects of maternal employment and prematurity on child cognition and behavior in single-parent families. Methods Sixty preterm and 61 full-term preschool children were recruited through NICU admission records and birth records. Data were collected with the Kaufmann Assessment Battery for Children, Peabody Picture Vocabulary Test, Child Behavior Checklist, Parenting Stress Index, and the Life History Calendar. Results Greater hours employed was related to higher achievement and mental processing scores only. Less discrepancy between actual and desired employment was related to higher achievement, mental processing, and language scores and lower behavior scores. Prematurity was not related to child cognitive and behavioral performance. Only the relationship between discrepancy and language remained after statistical control. Conclusions The concerns about negative effects of maternal employment on young children may be overstated, especially in low-income, single-mother families. These findings are especially important in the context of welfare reform

Work status and the quality of life

The general thesis from which this paper derived is that objective conditions are related to perceptions and evaluations of those conditions, but that such relationships are mediated by personal characteristics such as expectation and aspiration levels, and other motivational factors. The specific relationship examined is that between work status and overall life satisfaction among women. Although there is little difference in average levels of life satisfaction expressed by housewives and by women working outside the home, substantial differences emerge when women are distinguished by their motivation with respect to paid work: among women who want jobs, working women are more satisfied with their lives than are housewives; while among those who would prefer not to work, housewives are more satisfied. Evidence is also found in support of a hypothesis that work tends to be less central to the overall quality of women's lives than is true for men.Peer Reviewedhttp://deepblue.lib.umich.edu/bitstream/2027.42/43690/1/11205_2004_Article_BF00353134.pd

Predicting Successful Aging in a Population-Based Sample of Georgia Centenarians

Used a population-based sample (Georgia Centenarian Study, GCS), to determine proportions of centenarians reaching 100 years as (1) survivors (43%) of chronic diseases first experienced between 0–80 years of age, (2) delayers (36%) with chronic diseases first experienced between 80–98 years of age, or (3) escapers (17%) with chronic diseases only at 98 years of age or older. Diseases fall into two morbidity profiles of 11 chronic diseases; one including cardiovascular disease, cancer, anemia, and osteoporosis, and another including dementia. Centenarians at risk for cancer in their lifetime tended to be escapers (73%), while those at risk for cardiovascular disease tended to be survivors (24%), delayers (39%), or escapers (32%). Approximately half (43%) of the centenarians did not experience dementia. Psychiatric disorders were positively associated with dementia, but prevalence of depression, anxiety, and psychoses did not differ significantly between centenarians and an octogenarian control group. However, centenarians were higher on the Geriatric Depression Scale (GDS) than octogenarians. Consistent with our model of developmental adaptation in aging, distal life events contribute to predicting survivorship outcome in which health status as survivor, delayer, or escaper appears as adaptation variables late in life

Density, crowding, and satisfaction with the residential environment

The relationships between a set of measures of various components of environmental density and perceived crowding are examined in a data set from a sample of residents of a large metropolitan area. While there are meaningful patterns observed among the correlations, the primary finding is the weakness of the relationships between density and crowding. The implications of the weak relationship between objective and subjective measures intended to measure components of the quality of life, of which the present findings are an example, are discussed; the usefulness of subjective measures may lie primarily in their capacity to define what aspects of society should be monitored and included in a system of social accounting.Peer Reviewedhttp://deepblue.lib.umich.edu/bitstream/2027.42/43679/1/11205_2004_Article_BF00287219.pd