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Americans feel economically stagnated
Mennakshi Ganjoo in Silicon Valley
 
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April 10, 2008 15:56 IST

For the first time in 50 years, a majority of Americans feel that they are stuck in their tracks and not moving forward in life, according to a recent national survey.

The survey by the non-profit think tank Pew Research Center found that 25 per cent of respondents believe that they haven't moved forward in life in the past five years, while another 31 per cent say they have fallen back-wards.

For decades, middle-income Americans had been making absolute progress while enduring relative decline. But since 1999, they have found it difficult to make economic gains, the survey found.

As of 2006, (the last year for which trend data are available), real median annual household income had not yet returned to its 1999 peak, making this decade one of the longest downturns ever for middle-income groups.

However, when asked to measure their progress over a longer time frame, Americans are more upbeat. Nearly two-thirds say they have a higher standard of living than their parents had at their age.

In fact, over a longer time period, the picture is much brighter with median household income rising over 41 per cent since 1970. However, this has not spread evenly, with median net worth of upper-income families more than doubling, while those of the middle-income families grew by just 29 per cent.

For the past two decades, middle-income Americans have been spending more and borrowing more. At a time when these borrow-and-spend habits have spread, Americans say it has become harder to sustain a middle-class lifestyle, according to the survey report.

Nearly eight-in-ten (79 per cent) respondents in the Pew Research Center survey say it is more difficult now than five years ago for people in the middle class to maintain their standard of living.

Back in 1986, just 65 per cent of the public felt this way. The current economic slowdown and rising prices are taking a bite out of the family budget. Slightly more than half of middle class respondents say they have had to tighten their belts in the past year.

Roughly the same proportion expects to make more cutbacks in the year ahead.

Nonetheless, the American middle class is optimistic about the future. Most are confident that their quality of life in five years will be better than it is now. And, gazing farther ahead, most expect their children to do better in life than they themselves have done.


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