In This Economy, High School Grads Are Falling Out of The Middle Class

Last week, Pew Research released a 74-page report, “The American Middle Class Is Losing Ground,” which examined economic data from 1971 to 2015. The study discovered that “after more than four decades of serving as the nation’s economic majority, the American middle class is now matched in number by those in the economic tiers above and below it.” In other words, our economy has been hollowed out from the middle. We have become a nation of “haves” and “have-nots.”

Predictably, this evaporation of the middle class has affected some demographic groups more than others. Hispanics and millennials were hit hard, but no one lost more ground economically than adults who had no more than a high school diploma. Look at this graphic from the report:

"College isn't for everyone," says the person with a college degree.

“College isn’t for everyone,” says the person with a college degree.

As you can see, those with high school degrees lost even more income share (-21.9 percent) than those with less than a high school degree (-18.1 percent).

But did those with college degrees do much better? The answer is an unequivocal yes. During the period researched by Pew, “only one educational attainment group did not lose income status: college graduates.” Marinate on that for a second. Now look here:

Screen Shot 2015-12-16 at 3.51.08 PM

These numbers are startling. Americans with college degrees are “eight times as likely as adults who did not graduate from high school to live in upper-income households, and they are more than twice as likely as high school graduates or adults with some college education to be in the upper-income tier.”

Pew Research adds:

As the U.S. economy increasingly rewards those with job skills, college-educated Americans have an economic edge over other adults, even when the costs of going to college are factored in. They have a growing earnings advantage over those with no more than a high school diploma.

Their study seems to be pointing to a clear solution: in order to create a more robust middle class, we must ensure “open and universal access to postsecondary education.” Bernie Sanders, to his credit, has been cogently making this case for some time now:

Today, there is universal access to free, public schools across the United States for kindergarten through 12th grade. That didn’t happen by presidential decree. It took populist pressure from the progressive movement, beginning in the 1890s, to make widespread access to free public schools a reality. By 1940, half of all young people were graduating from high school. As of 2013, that number was 81 percent. But that achievement is no longer enough. A college degree is the new high school diploma.

Sanders is not wrong. I would only add this: a college degree is the new high school diploma for ensuring a middle-class life. This Pew study has shown why we find ourselves with an increasingly bifurcated economy: America has not equipped its citizens with the appropriate levels of education to ensure a strong middle class. Thomas Friedman made this case beautifully back in 2011:

When we were an agrarian society, that meant introducing universal primary education; as we became an industrial society, that meant promoting universal high school education; as we became a knowledge economy, that meant at least aspiring to universal postsecondary education.

The time for aspiration, though, has come and gone. Pew’s study illustrates that if we want a strong middle class, establishing universal postsecondary education would be an extremely effective solution. In an age where wages are frustratingly stagnant and consumer spending continues to disappoint, why aren’t we actively pursuing a policy change which we know cultivates larger incomes? We need a larger middle class because we need more robust participants in the economy. This, after all, is the fundamental law of capitalism:

If workers have more money, businesses have more customers. Which makes middle-class consumers, not rich businesspeople…the true job creators. Which means a thriving middle class is the source of American prosperity, not a consequence of it.

Morally, universal postsecondary education will create a much more equal (and educated) society, where a greater proportion of our population has an increased opportunity of securing a middle-class lifestyle.  And economically, it will bolster our nation’s “true job creators,” thereby empowering the source of American economic growth. If we want to restore the middle class in the 21st century, postsecondary education must play a key role. Our economic prosperity depends upon it.

Nick Cassella

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