The Middle Class Is Steadily Eroding. Just Ask the Business World.

[hvactec]

FEB. 2, 2014

In Manhattan, the upscale clothing retailer Barneys will replace the bankrupt discounter Loehmann’s, whose Chelsea store closes in a few weeks. Across the country, Olive Garden and Red Lobster restaurants are struggling, while fine-dining chains like Capital Grille are thriving. And at General Electric, the increase in demand for high-end dishwashers and refrigerators dwarfs sales growth of mass-market models.

As politicians and pundits in Washington continue to spar over whether economic inequality is in fact deepening, in corporate America there really is no debate at all. The post-recession reality is that the customer base for businesses that appeal to the middle class is shrinking as the top tier pulls even further away.

If there is any doubt, the speed at which companies are adapting to the new consumer landscape serves as very convincing evidence. Within top consulting firms and among Wall Street analysts, the shift is being described with a frankness more often associated with left-wing academics than business experts.

“Those consumers who have capital like real estate and stocks and are in the top 20 percent are feeling pretty good,” said John G. Maxwell, head of the global retail and consumer practice at PricewaterhouseCoopers.

In response to the upward shift in spending, PricewaterhouseCoopers clients like big stores and restaurants are chasing richer customers with a wider offering of high-end goods and services, or focusing on rock-bottom prices to attract the expanding ranks of penny-pinching consumers.

read more http://www.nytimes.com/2014/02/03/b...eroding-just-ask-the-business-world.html?_r=0

 

[waltky]

Uncle Ferd says Granny gonna have to start sellin' apples onna street corner if we gonna keep our livin' standard...

American Middle Class No Longer Most Affluent in the World
April 24, 2014 — The old political ploy of asking, "Are you better off today than four years ago?" can now be definitively answered: no. The American middle class is slipping from its former glory as the richest in the world.

Research compiled by the Luxembourg Income Study (LIS) over the past 35 years and interpreted by the New York Times reveals that America's lower- and middle-income population has stagnated – replaced by Canada as the most affluent. According to 2010 data and adjusted for inflation, the U.S. median per capita income of $18,700 has risen 20% since 1980, but is virtually unchanged since 2000. Meanwhile, between 2000 and 2010, median income rose by some 14% in the Netherlands -- and 20% in both Britain and Canada.

However, based on per capita gross domestic product, the U.S. still leads the global economy as the wealthiest advanced country, but a broad majority of Americans don't see these income gains which enrich mostly high-earning households, according to the study. LIS, located in Luxembourg, acquires datasets with income, wealth, employment and demographic data from a large number of countries, offering cross-national comparisons.

The report says additional surveys, conducted by government agencies for more recent periods, indicate that since 2010 income in Canada has risen faster than in the U.S. and is now quite likely higher. Several European countries have also seen higher income growth over the same period. "The idea that the median American has so much more income than the middle class in all other parts of the world is not true these days," Harvard economist Lawrence Katz told the Times. "In 1960, we were massively richer than anyone else. In 1980, we were richer. In the 1990s, we were still richer."

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