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Why Is the White Working Class in Decline?


Monday, May 20, 2019

By William Emmons, Lead Economist; Ana Hernández Kent, Policy Analyst; and Lowell Ricketts, Lead Analyst, Center for Household Financial Stability

Thirty years ago, more than half of American families were white and didn’t hold a four-year college degree.We used the shorthand “whites” to refer to non-Hispanic whites and defined working-class families as those headed by someone without a four-year college degree. These white working-class families earned almost half of all the income and owned almost half of all the wealth in the U.S.

In “The Bigger They Are, The Harder They Fall: The Decline of the White Working Class,"Emmons, William R.; Kent, Ana. H.; and Ricketts, Lowell, R. “The Bigger They Are, The Harder They Fall: The Decline of the White Working Class,” The Demographics of Wealth, 2018, Essay No. 3, September 2018. we documented a substantial decline in both the number of white working-class families and, even more rapidly, the shares of all income and wealth accounted for by these families between 1989 and 2016. We showed that other key measures of well-being—including homeownership rates, marriage or cohabitation rates, and health status—have also deteriorated for these families.

We conjecture that the decline of the white working class may be due, in part, to the reduction over time of advantages its members once had versus nonwhite families without a bachelor’s degree.

The White Working Class is Declining

Families that make up the white working class have declined from 55% to 42% of all families since 1989, and their economic and financial standing have declined even faster. (See the figure below.)

White Working Class Share of population, income and wealth

Collectively, their share of all income earned fell from 45% to 27%, and their wealth share tumbled from 45% to 22% during these three decades. Other measures of well-being also declined for the group:To illustrate long-term trends, we compared averages in the early years of the Survey of Consumer Finances (1989-98) to those in more recent years (2010-16).

Homeownership Rate

The homeownership rate among white working-class families moved down slightly since the early period of our data (1989-1998). This happened even though homeownership became more common overall and for each of the four major racial and ethnic groups:

  • Non-Hispanic white
  • Non-Hispanic African American or black
  • Hispanic of any race
  • All other races and ethnicities

Marriage Rate

The marriage rate (including cohabiting couples) trended down among white working-class families. Conversely, the Hispanic rate remained above that of the white working class, and the black working-class marriage rate increased significantly.

Health Status

The average self-assessed health status of members of the white working class dropped sharply, while it increased among the Hispanic and black working classes.

It’s Not about Race—Whites with College Degrees Are Thriving

The plight of the white working class contrasts sharply with the group of families headed by white four-year college graduates. This group increased from 20% to 26% of all families between 1989 and 2016. Also, their share of all income earned in the economy jumped from 41% to 53%, and their share of wealth soared from 46% to 67%. Moreover:

  • White college graduates’ homeownership rate increased sharply.
  • Their marriage rate was little changed.
  • Their self-assessed health—while slipping somewhat—remained the highest among all groups defined by race or ethnicity and education.

It’s Not about Class, Either—Nonwhite Working Classes Are Rising

In contrast to the declining white working class, Hispanic and black families without four-year college degrees have generally held steady or improved slightly during the last few decades on the measures we tracked.A fourth group—which includes Asians, Native Americans, families headed by someone of more than one race or ethnicity, and a variety of others—is small and diverse. We omitted them here, but the essay provides comparative information for these families.

As a share of the population, the black working class constituted 11% of all families in 1989, rising to 12% in 2016. The Hispanic working class increased from 7% to 9%. Median income and median wealth for both nonwhite working classes increased or held steady against population medians over time, while median white working class income and wealth both fell.

And in contrast to the white working class, both black and Hispanic working classes improved over time in relative terms on all three of the other measures we tracked: homeownership, marriage and self-assessed health.Marriage rates declined somewhat among Hispanic working class families but less so than for white working class families. The rate among Hispanic families remained the highest across all working-class groups.

Neither Race nor Education Alone Explains the Decline of the White Working Class

As a group, the white working class has fared poorly since at least 1989 on a variety of measures. White college graduates, meanwhile, are thriving. Thus, “white disadvantage” and “reverse discrimination” are not plausible explanations for the decline of the white working class.

At the same time, black and Hispanic working classes have held their own or advanced in recent decades on many measures. Hence, the lack of bachelor’s degrees is also insufficient to explain the decline of the white working class.

One theory is that job-market factors unique to white working-class families may have contributed to the decline we observe. Competition for low- and medium-skill jobs may have increased due to:

  • Convergence of black and Hispanic high-school graduation rates toward the white rate
  • Structural changes in the economy—including globalization, deindustrialization and technological advancement—that hit white working-class communities hard
  • The decline of explicit race- or ethnicity-based discrimination in the workplace, which previously had benefited white workers

Struggles in the job market—higher unemployment rates and lower growth (or even declines) in wage rates—may then have spilled over into the set of socioeconomic indicators described above.

Despite remaining by far the largest single group in the U.S. defined by race or ethnicity and college-degree status, we conclude that some key socioeconomic outcomes of the white working class in recent decades are not representative of the population as a whole. To an important extent, the white working class is unique. While other groups have thrived or held their own, the white working class has struggled.

Notes and References 

We used the shorthand “whites” to refer to non-Hispanic whites and defined working-class families as those headed by someone without a four-year college degree.

2 Emmons, William R.; Kent, Ana. H.; and Ricketts, Lowell, R. “The Bigger They Are, The Harder They Fall: The Decline of the White Working Class,” The Demographics of Wealth, 2018, Essay No. 3, September 2018.

3 To illustrate long-term trends, we compared averages in the early years of the Survey of Consumer Finances (1989-98) to those in more recent years (2010-16).

4 A fourth group—which includes Asians, Native Americans, families headed by someone of more than one race or ethnicity, and a variety of others—is small and diverse. We omitted them here, but the essay provides comparative information for these families.

5 Marriage rates declined somewhat among Hispanic working class families but less so than for white working class families. The rate among Hispanic families remained the highest across all working-class groups.

Additional Resources

Posted In FinancialHousing  |  Tagged william emmonsana hernandez kentlowell rickettsincomewealthcollegeworking classeducationhomeownershiphealth
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