62 percent of jobs don’t support middle-class life

Esther Akutekha, who lives in Brooklyn, New York, has a good job as a public relations specialist that pays more than $50,000 a year.

But because of the $1,440 a month rent on her studio apartment in the Prospect-Lefferts Gardens neighborhood, she never takes vacations, dines out just once a month and scrapes together dinner leftovers for lunch the next day.

“I’m frustrated with the fact that I’m not going to be able to save anything because my rent is so high,” says Akutekha, who says she’s 30ish. “I don’t even know if I can afford” to have children.

Despite an unemployment rate that has reached a 50-year low of 3.7 percent, most jobs across the U.S. don’t support a middle-class or better lifestyle, leaving many Americans struggling, according to a new study.

Sixty-two percent of jobs fall short of that middle-class standard when factoring in both wages and the cost of living in the metro area where the job is located, according to the study by Third Way, a think tank that advocates center-left ideas.

“There’s an opportunity crisis in the country,” says Jim Kessler, vice president of policy for Third Way and editor of the report. “It explains some of the economic uneasiness and, frankly, the political uneasiness” even amid the most robust U.S. economy and labor market since before the Great Recession of 2007 to 2009.

A slight majority of Americans, 52 percent, do live in middle-class households, according to recent annual reports by Pew Research Center. And another 20 percent or so live in upper income households. But that’s because they’re juggling multiple jobs, for example, or relying on investments, an inheritance or other household members who may have higher-paying jobs.

The Third Way study more starkly assesses the jobs in each metro area and the opportunities they’re providing to live a good life. By those measures, the study found that Trenton, New Jersey, and Durham, North Carolina, rank highest among the nation’s 204 largest metro areas in share of middle-class or better jobs. Honolulu and Myrtle Beach, South Carolina, on the other hand, are near the bottom.

Some areas, such as Myrtle Beach, fall short because of a scarcity of good-paying jobs. Among the biggest cities, Los Angeles, New York City and San Francisco were ranked fairly low (172nd, 168th and 174th, respectively) despite thriving economies because of their high cost of living.

Other large cities such as Washington, D.C. (14th) and Boston (61st) surmounted their high-cost burdens with a large share of jobs in flourishing sectors such as government and technology. Houston (18th) is blessed with both vibrant energy and aerospace industries and relatively moderate costs.

The rankings highlight some vivid contrasts. A factory machinist in Cedar Rapids, Iowa, earns an average $45,470 a year, more than enough to meet the $40,046 threshold for a middle-class job in that area.

A similar machinist makes more – $57,220 on average – in San Francisco, but that’s far short of the $82,142 minimum for a middle-class job in that area, according to the report. It costs an average $32,440 a year to rent a one-bedroom apartment in San Francisco, compared with $7,368 in Cedar Rapids.

Akutekha was set back in her career path because she graduated from college during the Great Recession and initially could only find jobs in industries such as fast-food and as an assistant in a law office. She got the public relations position at a nonprofit this year but, “I just feel like I’m back to square one,” she says.

She says she’s not considering moving because major cities such as New York offer far more opportunities in her field.

Nationally, the study found:

• 30 percent of jobs are “hardship jobs,” meaning they don’t allow a single adult to make ends meet.
• 32 percent are “living wage” jobs, enough to get by but not to take vacations, save for retirement or live in a moderately priced home.
• 23 percent are middle-class jobs, allowing for dining out, modest vacations and putting some money away for retirement.
• 15 percent are “professional jobs,” paving the way for a more comfortable life that includes more elaborate vacations and entertainment and a more expensive home.

A big reason for the dearth of middle-class jobs is the offshoring of millions of middle-income factory positions to countries with lower labor costs, such as China, in recent decades and the spread of lower-paying service jobs. Former manufacturing strongholds that have remade themselves fare better. Cleveland, which has become a health and biotech hub, is ranked sixth while Youngstown, Ohio, is 80th.

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