A Little Perspective
Pew Study: U.S. Middle Class Smaller But Richer Than Europe’s

The Pew Research Center recently released an ambitious study tracking the changing fortunes of the middle class in Western Europe and the United States from 1991 to 2010. Among the findings: the American middle class is smaller than Europe’s (and declining), but it nonetheless remains substantially richer than almost any other European country’s. More:

Compared with Western Europe, the U.S. middle class is smaller. Among the countries examined, the U.S. is the only country in which fewer than six-in-ten adults were in the middle class in 2010. Meanwhile, compared with many Western European countries, greater shares of Americans were either lower income (26%) or upper income (15%).  […]

Incomes of middle-class households in the U.S. are greater than the incomes of most Western European middle classes. Financially, the American middle class is ahead of the middle classes in the Western European nations in terms of disposable (after-tax) household income, with the exception of Luxembourg. Middle-income households in Luxembourg lived on $71,799 annually in 2010, at the median, followed by $60,884 in the U.S. The middle class in Italy lived on a median income of $35,608, the most modest means among the countries analyzed.

The results are worth exploring in full. While the Pew study does offer catnip to those concerned about income inequality, it also reveals how prosperous the United States remains by comparison with Europe. With the exception of Luxembourg, for instance, the U.S. tops every western EU country when it comes to disposable income for the middle and upper class:

The Pew study does not break down U.S. income data on a state-by-state basis, complicating any direct comparisons between American states and EU countries along its methodology. But a look at 2010 U.S. census data reveals the general trend: even the poorest U.S. states beat the poorest European countries when it comes to median household income, while only Luxembourg tops the richest states.

In 2010, for instance, the median household income in Mississippi (in 2011 inflation-adjusted dollars) was $37,838; the equivalent in Maryland was $70,976. By comparison, the average Italian household took home $35,608 that year, while a middle-income Norwegian household earned a median income of $56,960. Put another way: average households in states like Maryland, Connecticut, or Massachusetts are richer than those in Norway, Denmark, or the Netherlands, while residents of Mississippi or West Virginia are better off than the Spaniards and Italians.

For all the talk about rising inequality and a shrinking middle class, then, we Americans should count our blessings: when it comes to disposable income, you are still better off living in Mississippi than Italy.

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