Clark County’s middle class feeling squeezed

Challenges grow for a segment of society that’s tough to define

By Paris Achen, Columbian courts reporter

Published:

 

Since Vancouver resident Tricia Brandemihl was laid off two years ago from her job as an escrow officer, she and her family have had to cut back on everything from entertainment to health insurance. Since her unemployment benefits expired, the family of four lives off of her husband’s job as a vehicle service adviser.

What’s ‘middle class’ in Clark County?

Some different definitions:

Median income earners. The county’s median household income was $56,074 in 2009.

Professionals and managers. About 33.9 percent of workers in the county were managers and professionals, and 26.2 percent had sales and office occupations.

Education attainment. A total of 64 percent of county residents have some kind of higher education, from those who have been to college but didn’t attain a degree to those with graduate degrees.

Middle 80 percent of income earners. That group earned between about $16,000 and $134,000 in 2009.

Income of roughly 200 percent of the poverty level ($36,620 for a family of 3) to $100,000. Then, roughly 48 percent of county households that earn between $35,000 and $99,999 would be middle class.

President Barack Obama’s definition of families that earn up to $250,000. Just 3 percent of the county’s households make $250,000 or more.

Sources: U.S. Census Bureau, Scott Bailey, regional labor economist for the Washington State Employment Security Department; Reuters, Columbian research.

“We had always been able to put money in an account for our kids’ college, and that has stopped,” Brandemihl said. “We can’t afford it, along with putting money away for retirement. We’ve had to reduce our life insurance. It’s either eat or do these other things.”

Brandemihl sees her family as the quintessential image of the American middle class. Her family’s story of increasing financial struggle is one repeated across the county and nation in discussions between friends and family, media reports, policy making and political debate.

But what exactly is the middle class, and how much of Clark County fits in that category?

“I think it’s an income bracket somewhere between $30,000 and $80,000,” said Vancouver resident Dean Cunningham, a homeowner, former nurse and Clark College student. “There are different gradations of middle class: lower, upper and middle. I consider myself firmly in the middle.”

There is actually no consensus on a definition of the middle class, unless you happen to be a sociologist. Yet many Clark County residents and Americans identify with the term. And by more than one definition, the county could be considered predominantly middle class, with a greater percentage of county residents falling in the middle-income range than in the state and nation.

To many, the middle class represents aspirations to self-determination, owning a home, sending their children to college and living comfortably in retirement, but the reality of the middle class has changed. In order to make policy that helps the middle class, policymakers need a definition of what that actually means in economic terms.

Vancouver resident Paul Seif said he would consider himself middle class, but the reality of his life differs from that of past middle class generations.

“When my grandfather came back from the war (World War II), he immediately got a job with San Diego Gas & Electric (without a college degree),” Seif said. “With his income, he was able to buy a second home and an RV. He was able to go on vacation all the time and able to sock away money for his kids. That’s not the world we live in, and they were a single-income family.”

Seif, who has a bachelor’s degree, and his wife, who has a master’s degree, both work professional jobs. He does communications for a nonprofit environmental group; she’s an adjunct instructor at three community colleges.

“We both work, and we can only afford health insurance for our kids, but not for ourselves,” Seif said. “Both my grandfather and I would identify ourselves as middle class, so what does that say about what middle class is?”

In sociology, the concept of class dates back to the 1800s when German sociologists Max Weber and Karl Marx categorized people based on their relationship to the economy, said Alair Maclean, assistant professor of sociology at Washington State University Vancouver.

“They had the view there were two classes: people who own things and people who have to work,” Maclean said. “In the mid-1900s, sociologists felt there were lots of people who fell in between workers and capitalists.”

Between the 1950s and 1970s, they developed a third category, the middle class, she said. It encompassed people with higher education, professionals and positions of authority in the workplace, such as managers and supervisors.

“Most Americans think of middle class in terms of income. They are people who are comfortable but not wealthy,” Maclean said. “That’s not true in sociology. You could have professionals who are quite poor but still middle class.”

Vancouver resident Janice Hobson adheres to the mainstream definition Maclean described.

“Middle class is a house in the suburbs, several children, both parents working,” Hobson said. “They have a few toys, maybe a boat. They probably have a little more than a family scraping by.”

Seif defines the middle class as people “who have the ability to move at will.”

Ambiguous term

Labor economist Jeff Zahir at the Washington State Employment Security Department in Olympia went on a quest last November to find an economic definition of the term in order to help guide state economists and policy makers examining employment and income issues.

“There were a lot of people talking about the disappearance of the middle class because of the inequity in wage distribution, the gap between the rich and the poor,” Zahir said. “It’s been in the press. It’s an issue related to federal policy and related to local state policy. Throwing the term around, people wanted to know: What does this actually mean? I think I understand it intuitively, but in truth, I don’t have a useful definition.”

In addition to the term “middle class”, terms such as “working poor”, “middle class rich” and “super rich” have been developed to describe differences in economic status, Zahir noted in his November 2010 economics issue paper on the topic.

“Unfortunately, these terms have also been muddled,” he wrote.

As an economist, terms such as “middle class rich” are useless in research unless they are assigned a numeric value, in this case, mainly an income range. So, Zahir asked prominent economists at universities around the nation to tell him how they define the term.

“I must say that I have no idea,” responded David Autor, professor at MIT’s Department of Economics. Instead of middle class, Autor uses the term “median wage” and “middle skill,” which is workers with a high school or some college education but no four-year degree.

“Middle class is a nebulous term when applied to workers and even more so when applied to families, so I generally stay away from the term,” Autor wrote. “But when I talk to the press, they often substitute the phrase ‘middle class’ for the terms that I use.”

Income level

If middle class equates to median wage, or income, then, a household with an annual income of $56,074 would be the bull’s-eye of the middle class in Clark County, based on 2009 U.S. Census estimates. That was the lowest median income in the county since 2006. The average household size was 2.72 people. The county has a higher percentage of households in the median income bracket of $50,000 to $74,999 than both the state and nation. About 20.9 percent of the county falls in that range compared to 19.2 percent in the state and 18.3 percent in the nation.

“I would say the majority of Clark County is middle class,” said Washougal resident Gina Staros. Staros, an editor at a marketing agency, considers her family middle class, but in her neighborhood, she sees evidence of the middle class under increasing financial pressure.

“My next door neighbor was foreclosed on,” Staros said. “He is an engineer. When the economy went down, the demand for his job went down. The economy is not helping us.”

Robert Reich, former labor secretary under President Bill Clinton and public policy professor at University of California Berkeley, said he defines middle class as anyone whose income is greater than the bottom 10 percent of income earns and less than the top 10 percent.

The middle 80 percent in Clark County in 2009 had household income of between $16,000 and $134,000, said Scott Bailey, regional labor economist in Vancouver for the state employment security department.

“Some of those households are single, elderly; some would be in a group living situation,” Bailey said.

Marieka Klawitter, associate professor of public affairs at the University of Washington, suggested looking at an income range between 200 percent of poverty level and $100,000.

“Most people would draw the line at about $100,000 unless they make over that,” Klawitter wrote.

Two hundred percent of the poverty level for a family of three was $36,620 in 2009, according to federal poverty guidelines. Under Klawitter’s definition for the middle class, nearly 48 percent of county households that had income of $35,000 to $99,999 in 2009 would be considered middle class. About 35 percent have income less than that, and the other 17 percent earn $100,000 or more, according to U.S. Census figures. Just 3 percent of households in Clark County earn $200,000 or more.

In 2010, President Barack Obama said middle class tax cuts would apply to families that earn up to $250,000, all but 3 percent of U.S. households, Reuters reported.

The vanishing class

As Zahir noted, media reports on the disappearance of the middle class hinge on economic studies that show increasing income disparity between a small percentage of top income earners and the majority of Americans.

That trend is palpable in Clark County.

“I think it’s fair to say this recession is pushing people, depending on how you define the middle class, people lower, and it doesn’t look like we are going to snap back anytime soon,” said Bailey, regional economist for Southwest Washington.

A labor market and economic analysis Bailey did this month shows a 23.7 percent increase in the number of households earning less than $35,000, a 9 percent decline in the number of households earning $35,000 to $149,999 and a 15.6 percent increase in households earning $150,000 and more between 2008 and 2009. During the same period, the county’s poverty rate increased from 13.2 percent to 14.3 percent, the highest rate in several years. That rate rose faster than in the state and nation, Bailey said.

Orchards resident Joe Samdberg said the majority of the county is middle class and doesn’t think the class is going extinct.

“I saw a lot of folks losing homes,” he said. “Recently, I’ve seen more businesses opening, and houses going up, This is not the first recession I’ve lived through.”

A turnaround, however, is difficult for some people like Brandemihl, the former escrow officer, to count on.

“Eventually, we hope to get back to a place where we can do the things we used to do,” Brandemihl said. “That’s the goal, but we are not seeing the light at the end of the tunnel just yet.”

Paris Achen: 360-735-4551; http://www.twitter.com/Col_Trends; http://www.facebook.com/ColTrends; paris.achen@columbian.com