Under Pressure: The Squeezed Middle Class

Foreword
Acknowledgements
ISO Codes
Executive summary
Chapter 1.  Overview
	1.1. The middle class dream is increasingly only a dream for many
	1.2. The middle class is an engine for prosperity and economic growth
	1.3. Most people identify themselves as belonging to the middle class
	1.4. The economic influence of the middle class is weakening
	1.5. The cost of living has been rising
	1.6. Chances to reach the middle class have decreased for younger generations and those with lower and medium skills
	1.7. A squeezed middle class raises economic, social and political risks
	1.8. Policies need to be geared to the new challenges facing middle-class households
		1.8.1. Tackling unfairness
		1.8.2. Tackling cost of living issues
		1.8.3. Tackling labour market vulnerability
	1.9. Conclusion
	Notes
	References
Chapter 2.  A declining middle-income class?
	Introduction and key findings
	2.1. Who is considered middle-income?
		2.1.1. Most people are in the middle-income class
		2.1.2. Richer countries have larger middle-income classes
		2.1.3. How much income does a household need to be middle-income?
	2.2. Middle incomes have stagnated, hollowed out and lost influence
		2.2.1. Middle incomes are falling behind
		2.2.2. Are middle incomes being hollowed out?
		2.2.3. Middle-income households are losing economic influence
		2.2.4. Middle incomes have been more stable than lower and upper incomes and more resilient to poverty since the crisis
		2.2.5. Middle-income households are no longer what they used to be
		2.2.6. Income classes converge across age groups
		2.2.7. Fewer families with children are middle income
		2.2.8. Fewer working-age households are middle income, whether in work or not
	2.3. Taxes, benefits and middle incomes
		2.3.1. Middle incomes pay most taxes, but at times less than their income share
		2.3.2. The middle-income class receives more benefits than the other income classes, though not proportionately to its share of the population
		2.3.3. Are middle incomes net contributors or net beneficiaries of tax-benefit systems?
		2.3.4. More taxes and more benefits for middle incomes since the crisis
	2.4. Conclusion
	Notes
	References
Chapter 3.  Where have the middle class jobs gone?
	Introduction and key findings
	3.1 The labour status of middle-income households
		3.1.1 Most working households remain middle income despite lower shares
		3.1.2 What are the jobs of middle-income workers?
	3.2 Labour market polarisation
		3.2.1 Polarisation has resulted in a net shift towards high-skill occupations
			The skills composition of middle-income workers
			Link between skill levels and income classes are weakening
		3.2.2 Changing patterns in working households
			More single adults and fewer single-earner couples in the middle-income class
			Skills and income levels in dual-earner households
	3.3 Wage distribution
	3.4 Non-standard work and middle-class security
	3.4 The future of middle-class jobs
		3.4.1 Risk of automation for current middle-income jobs
		3.4.2 Middle-income employment prospects
	3.5 Conclusion
	Notes
	References
Chapter 4.  The rising cost of the middle-class lifestyle
	Introduction and key findings
	4.1. Middle-income households contribute the most to consumption
	4.2. The middle class spends most of its budget on core goods and services
	4.3. As the cost of core goods and services has risen, so has middle class spending
		4.3.1. Middle-income spending has risen faster than income
		4.3.2.  The middle-class is spending more on core goods and services
			Housing makes up an increasing share of middle-class budgets
			Private health spending accounts for a growing share of middle-class budgets
		4.3.3. Prices of basic needs have soared
			House prices outstrip inflation and median incomes
			Healthcare costs grow faster than inflation
			Higher education costs increase student debt as university attendance grows
			Other budgets items vary as spending patterns and preferences evolve
	4.4. Middle class increasingly financially vulnerable and at times over-indebted
		4.4.1. Many middle-income households are financially vulnerable or struggle to make ends meet…
			Four in ten are financially vulnerable and half struggle to make ends meet
		4.4.2. …and some have trouble maintaining their living standards
		4.4.3. Middle-income class more over-indebted than the total population
	4.5. Conclusions
	Notes
	References
		Annex 4.A. Data sources
Chapter 5.  Policies for a prosperous middle class
	5.1. Introduction
	5.2. Boosting middle-class incomes and wealth
		5.2.1. Ensuring fair wages for low and medium earners
		5.2.2. Increasing female labour force participation and earnings
		5.2.3. Reducing the tax burden on middle-income households
		5.2.4. Providing effective income protection for workers with unstable employment and earnings trajectories
		5.2.5. Enabling and encouraging middle-class households to accumulate wealth
	5.3. Helping households cope with the rising costs of housing, education, health and long-term care
		5.3.1. Ensuring affordable housing
		5.3.2. Helping families pay for their children’s education
		5.3.3. Supporting households with high health care and long-term care costs
	5.4. Equipping the middle class with the skills needed in a changing workplace
		5.4.1. Offering attractive vocational pathways
		5.4.2. Promoting adult learning – on the job and out of work
	Notes
	References
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