The American Class Structure and Growing Inequality Chapter 11 The American Class Structure and Growing Inequality

How Many Classes Are There? According to Gilbert, there are six social classes in the United States: Capitalist Class Upper-Middle Class Middle Class Working Class Working Poor Underclass This model of the American class structure is based on qualitative economic distinctions. The emphasis is on the source of income as opposed to the amount of income. © Pine Forge Press, an Imprint of SAGE Publications, Inc., 2011

© Pine Forge Press, an Imprint of SAGE Publications, Inc., 2011

© Pine Forge Press, an Imprint of SAGE Publications, Inc., 2011 The Capitalist Class The Capitalist Class has a strong influence on the nature and direction of the economy largely as a result of its investment decisions. The economic resources of members of this class also enables them to operate within the world of politics and the media in ways that reinforce their structural position while at the same time shaping the views of other classes. This class is defined by its dependence on income-producing wealth. © Pine Forge Press, an Imprint of SAGE Publications, Inc., 2011

The Upper-Middle Class The Upper-Middle Class is a highly credentialed group. It can be distinguished from the Capitalist Class not only because of lower incomes but because the majority of the income is acquired through salaries and/or professional fees as opposed to income-generating wealth. This class’s ever-increasing purchasing power is making its members more influential with their lifestyle becoming increasingly normative for the whole society. The income gap between the Upper-Middle Class and the non-privileged classes has widened . © Pine Forge Press, an Imprint of SAGE Publications, Inc., 2011

© Pine Forge Press, an Imprint of SAGE Publications, Inc., 2011 The Middle Class The changing character of work has largely eliminated traditional differences between blue- and white-collar work. The Middle Class is large and diverse. Though some commentators have argued that the Middle Class is disappearing, Gilbert suggests this is not the case. It is not the Middle Class but rather the middle-income group that is shrinking. This is because of both the declining earnings of many Working-Class positions and the growth of family incomes toward the upper end of the distribution. © Pine Forge Press, an Imprint of SAGE Publications, Inc., 2011

© Pine Forge Press, an Imprint of SAGE Publications, Inc., 2011 The Working Class The Working Class has traditionally consisted of semiskilled blue-collar laborers. Well-paying jobs for these workers have been declining. Workers in routine white-collar jobs would be considered members of this class. The political influence of this group has declined significantly as the goods-producing industries of the economy, typically with strong union membership, have contracted. © Pine Forge Press, an Imprint of SAGE Publications, Inc., 2011

© Pine Forge Press, an Imprint of SAGE Publications, Inc., 2011 The Working Poor The Working Poor includes most service workers and the lowest-paid operatives and sales and clerical workers. Members of this social class tend to have less stable job histories, sometimes for reasons beyond their control. They are alienated from political life leading to only marginal involvement in the political process. The lower boundary of this class, defined by commitment to employment, is blurred by the tendency of some individuals to move back and forth across it. This can be termed “oscillating mobility.” © Pine Forge Press, an Imprint of SAGE Publications, Inc., 2011

© Pine Forge Press, an Imprint of SAGE Publications, Inc., 2011 The Underclass The Underclass includes low-income households whose members have limited participation in the labor force. Limited and erratic work histories, lack of skills, and incomplete education makes finding full-time employment difficult for members of this class. A large segment of the Underclass consists of single mothers. A significant portion of the Underclass depends on government transfer programs including public assistance, Social Security, Supplemental Security Income (SSI), and veterans benefits. Long-term effects of the 1996 welfare reform legislation on this social class are still difficult to determine. © Pine Forge Press, an Imprint of SAGE Publications, Inc., 2011

© Pine Forge Press, an Imprint of SAGE Publications, Inc., 2011 Growing Inequality Occupational Structure The transition from an industrial to a postindustrial society occurred around 1970. Earnings Since the early 1970’s, wages have more or less stagnated, and the distribution of wages has become increasingly unequal. Wealth Wealth has become increasingly concentrated at the top of the class hierarchy. © Pine Forge Press, an Imprint of SAGE Publications, Inc., 2011

Growing Inequality, cont. Poverty There has been no appreciable reduction in the poverty rate in nearly 40 years. The poor are less likely to be over 65 and more likely to be under 18 than they were in 1960 and are much more likely to live in female-headed families. Income Those at the middle and bottom of the class structure have seen their incomes grow at a much slower rate than during the Age of Shared Prosperity. Those at the top have seen their incomes soar. © Pine Forge Press, an Imprint of SAGE Publications, Inc., 2011

Growing Inequality, cont. Social life Residential neighborhoods are increasingly segregated by class, which has resulted in decreased levels of interclass association. Social Mobility Although intergenerational upward social mobility is still pretty common, it has slowed in the Age of Growing Inequality. Political Power Power has shifted away from the Working Class and Working Poor and toward the privileged class—in particular, the Capitalist Class. © Pine Forge Press, an Imprint of SAGE Publications, Inc., 2011

Why the Age of Growing Inequality? cont. Changes in the economy have been amplified by the decisions of corporations, families, and government. The transition from an industrial to a postindustrial society coincided with the beginning of the Age of Growing Inequality. Wage disparities have widened. Disparities are wider in the postindustrial present than in the industrial past. Advanced education and skills make winners out of those with them. Institutional mechanisms that once constrained the wage differentials have weakened. More competitive domestic and global markets have caused corporations to look for ways to cut labor costs such as downsizing and outsourcing. © Pine Forge Press, an Imprint of SAGE Publications, Inc., 2011

Why the Age of Growing Inequality? cont. Changes in family life have had an impact. Americans are less likely to marry, more likely to divorce, more likely to have children out of wedlock, and, as a result, much more likely to live in female-headed families. More women are employed and their earning have enabled families to overcome the erosion of men’s wages, but the net result of women’s increased employment is greater inequality among families. Public policy in the Age of Growing Inequality has become more responsive to the privileged classes and less sympathetic to other classes. © Pine Forge Press, an Imprint of SAGE Publications, Inc., 2011

Hard Times in the Age of Growing Inequality In December 2009, nearly one in five workers was unemployed or underemployed. The burden of this has not been evenly distributed among the different social classes. The Working Class and the Working Poor have borne the brunt. The recession has worsened trends we have seen in the Age of Growing Inequality including poverty, wage polarization, income inequality, and a shrinking manufacturing base. The end of the Age of Growing Inequality is nowhere in sight. © Pine Forge Press, an Imprint of SAGE Publications, Inc., 2011