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Under Pressure: The Squeezed Middle Class

image of Under Pressure: The Squeezed Middle Class

Middle-class households feel left behind and have questioned the benefits of economic globalisation. In many OECD countries, middle incomes have grown less than the average and in some they have not grown at all. Technology has automated several middle-skilled jobs that used to be carried out by middle-class workers a few decades ago. The costs of some goods and services such as housing, which are essential for a middle-class lifestyle, have risen faster than earnings and overall inflation. Faced with this, middle classes have reduced their ability to save and in some cases have fallen into debt. This report sheds light on the multiple pressures on the middle class. It analyses the trends of middle-income households through dimensions such as labour occupation, consumption, wealth and debt, as well as perceptions and social attitudes. It also discusses policy initiatives to address the concerns raised by the middle class, by protecting middle-class living standards and financial security in the face of economic challenges.

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Executive summary

Over the past decade, the OECD has documented the evolution of inequalities in income and opportunities in details in a series of flagship publications, from Growing Unequal? (2008), to Divided we Stand (2011), to In it Together (2015) and the latest release on The Broken Social Elevator that focused on social mobility and showed that opportunities for low‑ and middle‑income families to move up the ladder became limited over the past decades. The present report zooms in on the middle class and sheds light on the multiple pressures this group faces.

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