Yes, the Middle Class Is Shrinking—Because It's Moving Up |
Economics
Veronique de Rugy | 1.15.2026 3:27 PM
"The middle class is shrinking" might be the assertion of the decade. Progressives and populists alike use it to justify nearly all government interventions, from tariffs to minimum-wage hikes to massive spending to income redistribution. But before we accept its validity, we should ask a simple question: shrinking how?
Is the number of Americans considered part of the middle class diminishing? Or the amount of wealth they can realistically build? Or the value of what they can buy?
A new study by economists Stephen Rose and Scott Winship usefully reframes the debate. Most studies define the middle class relative to the national median, which makes the dividing line between haves and have-nots rise automatically as the country gets richer. Rose and Winship instead use a benchmark of fixed purchasing power, so that if real incomes (those adjusted for inflation) rise, more people are shown moving into—or beyond—the middle class in a meaningful sense.
Under this approach, the "core" of the middle class does........