The middle class has traditionally been viewed as the backbone of
the American economy, but recent trends indicate that the American
middle class is shrinking. Over the past 50 years, the percentage of
adults living in middle-income households in the United States has
decreased by more than 10 percentage points, suggesting a
continuous decline of the middle class.
To gain insight into the current state of the middle class,
SmartAsset has analyzed the earnings range for middle-class
households in 100 of the largest cities in the United States, as well
as all 50 states.
However, finding a financial advisor who can help you navigate these
changes and achieve your financial goals can be challenging.
Fortunately, SmartAsset provides a free tool that matches you with
up to three qualified financial advisors who serve your area. You can
interview your advisor matches at no cost to decide which one is the
right fit for you.
If you're ready to take control of your financial future and find an
advisor who can help you achieve your goals, start by using
SmartAsset's free tool. By connecting with a financial advisor, you
can create a personalized financial plan that addresses your unique
needs and helps you navigate the shifting economic landscape.
Key Findings:
The American middle class is not a monolithic group, and different
regions and cities have vastly different salary ranges and costs of
living. According to a recent study by SmartAsset, salaries in the
Northeast are around 20% higher than those in the South, even
after adjusting for cost of living differences. In fact, the top 10
highest middle-class salary ranges are dominated by Northeastern
states, with many middle-class salaries falling between $60,000 to
$170,000. On the other hand, the same middle-class bracket in
many Southern states falls between about $35,000 to $100,000.
Interestingly, even within cities, the middle class can struggle to
make ends meet. For example, while cities like San Francisco and
Seattle are known for their high costs of living, their middle-class
salaries generally keep pace with those costs. However, in New York
City, the middle-class wage range falls behind the general cost of
living. The cost of living in Queens, Brooklyn, and Manhattan is 43%,
70%, and 138% higher than the national average, respectively,
making it difficult for the middle class to make ends meet.
Moreover, it's worth noting that middle-class status can be
challenging to attain in tech cities, such as San Francisco and San
Jose. These cities have some of the highest income thresholds for
the middle class in the country, with residents needing to make at
least $81,623 in San Francisco, $84,673 in San Jose, and $104,499
in Fremont. Interestingly, even households earning up to $311,936
per year in Fremont are still considered middle class, which is the
highest ceiling for any city in the study.
In conclusion, the middle class is not a homogeneous group, and
salaries and costs of living vary significantly across different regions
and cities in the United States. By understanding these differences,
individuals can make informed decisions about where to live and
work and how to achieve financial stability.
Cities With the Highest Middle-Class Ceilings:
1. Fremont, CA:
When it comes to the highest minimum threshold for middle-class incomes, Fremont, California, takes the top spot with a minimum income of $104,499. In fact, households in Fremont need to earn at least $104,499 to be considered middle class. One of the reasons for Fremont's high median income of $155,968 is its proximity to the high-paying jobs of Silicon Valley. With a population of nearly 230,000 people, almost one-tenth of that population works at Tesla, contributing to the city's overall economic prosperity.
2. San Jose, CA:
San Jose, California, is the third-largest city in the state and boasts a vibrant tech industry that includes high-profile companies such as Adobe, Cisco Systems, eBay, PayPal, and Zoom. The middle-class income bracket in this city ranges from $84,673 to $252,754, reflecting the high salaries available in the technology sector. San Jose's status as a hub for technology companies has contributed to the city's overall economic growth and prosperity.
3. Arlington, VA:
Arlington, Virginia, located along the banks of the Potomac River, benefits from its close proximity to Washington D.C. and a highly-educated workforce. With over 76% of residents aged 25 and older holding a bachelor's degree or higher, the education level in Arlington is more than double the national average. The federal government is the city's top employer, with the Department of Defense and several other agencies based there. In Arlington, households that earn up to $251,302 per year are considered middle class, while those earning less than $84,186 fall below the middle-class income threshold. The combination of a highly-educated workforce and its close proximity to the nation's capital has helped Arlington to thrive economically.
4. San Francisco, CA:
San Francisco is known for being a hub of innovation, with large tech
companies like Salesforce, Uber, and Twitter headquartered there.
However, the city is also home to non-tech brands such as Wells
Fargo and The Gap. In San Francisco, households that earn between
$81,623 and $243,652 per year are considered middle class.
Despite the city's high salaries, buying a home in San Francisco can
be incredibly challenging due to the exorbitant real estate prices.
The median home value in the city is a staggering $1.2 million
dollars. Nonetheless, San Francisco remains a desirable location for
those seeking a dynamic urban lifestyle and opportunities in the
tech industry.
5. Seattle, WA:
Seattle, a bustling city on the west coast, is home to many high-
profile companies such as Amazon, Starbucks, and Boeing. Nearly
66% of the population over 25 years old hold a bachelor’s degree or
higher, which is higher than the national average. To be considered
middle class, households in Seattle need to earn at least $74,223,
with the upper limit reaching $221,562. This suggests that while
the cost of living in Seattle is high, there is still room for households
to achieve middle-class status.
6. Irvine, CA:
Irvine, located in Orange County, California, boasts a diverse
economy with the healthcare and technology sectors being
significant contributors. However, the University of California, Irvine,
with its over 25,000 faculty and staff, remains the city's largest
employer. Middle-class households in Irvine earn an annual income
ranging from $70,869 to $211,548.
7. Gilbert, AZ:
Gilbert is a rapidly growing town in the Phoenix metropolitan area
with a population of over 273,000 residents as of 2022. The town's
strong economy is driven by industries such as healthcare,
education, and retail. The median household income in Gilbert is
$104,802, falling within the middle-class range of $70,217 to
$209,604 per year. With a lower cost of living compared to many
other cities on this list, Gilbert offers an attractive option for those
seeking a comfortable middle-class lifestyle.
8. Scottsdale, AZ:
Scottsdale is a charming city located in Maricopa County, Arizona,
that has much to offer both tourists and residents alike. Boasting a
plethora of luxurious resorts, rejuvenating spas, and world-
renowned golf courses, it's no wonder that Scottsdale is a top-rated
tourist destination. Additionally, the city is home to a variety of
healthcare and technology companies. Middle-class households in
Scottsdale typically earn between $66,395 and $198,194 per year,
making it a desirable location to live and work.
What It Takes to Be Middle Class in the 50 States:
When it comes to the middle class, Maryland, Washington D.C., and
Massachusetts are the top three states with the highest income
thresholds. To be considered middle class in these states,
households need to earn more than $60,000 annually. New Jersey
and New Hampshire are also among the top five states with the
highest income requirements, with thresholds of $59,828 and
$59,272 respectively.
On the other hand, Mississippi has the lowest income threshold for
the middle class, with households needing to earn only $32,640 per
year. West Virginia, Louisiana, Arkansas, and Alabama follow closely
behind with income thresholds of $34,336, $34,898, $35,194, and
$36,122 respectively.
Social Plugin