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Tue, June 18

The New Yavapai Economy: What does the middle class look like in 2016?

An economy is spurred by middle-class spending power. Through the past century, the middle class has been the largest section of the populous, hence the economy skipped along fairly steadily with wages sustaining purchasing through the years.

Unfortunately, the past 30 years has created an economy whereby returns on investment has exponentially grown while wages have remained the same or lowered. This has created a widening gap between the rich and the poor, and a substantial decrease in the portion of people who fall into the middle class.

According to the Pew Research Center, between 2009 and 2011 “the mean net worth of households in the upper 7 percent of wealth distribution rose by an estimated 28 percent, while the mean net worth of households in the lower 93 percent dropped by 4 percent.”

The center also reported that between 2000 and 2014 the proportion of people in the upper-income tier increased from 17 to 20 percent, while those in the lower-income tier increased from 28 to 29 percent.

The Pew Research Center defines middle income as those having three people and an annual income between $42,000 to $125,000. In Prescott, the annual average income is $41.6K, Prescott Valley sits at $41.2K, Chino Valley has an average income of $42K, Dewey-Humboldt is at 37.1K, and Yavapai County average annual income is $40.8K.

Ultimately, the decrease of the middle class has derived from a decrease in livable wage production oriented jobs that have been driven overseas or become obsolete due to automation.

Future demand for jobs will most likely involve service oriented, professional, and technical positions. As this federal prediction comes closer to fruition options for traditional employment narrow, investment in education and lifelong learning will be a necessary path for those looking to move up the income ladder.

Alexandria M. Wright is director of the Yavapai College Regional Economic Development Center, which provides analysis and services that facilitate economic development throughout Yavapai County and build wealth in our local communities.

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