A basic component of the American Dream is that each generation will be better off than the one before it. However, 30% of Americans who grow up in the middle class slip down the economic ladder as adults. There are many factors that contribute to this downward mobility, and reasons explaining who is most likely to fall down the income ladder, and why. Over all, there is a distinct impression of sliding “backward” for many in America. According to a 2012 U.S. Census Bureau report, median household income is down 8.1% from its 2007 levels, before the recession, and stood at $50,054 in 2011, a 1.5 percent decline from 2010.

A 2011 report by the Pew Charitable Trusts, “Downward Mobility from the Middle Class: Waking Up from the American Dream,” studies the factors that contribute to downward mobility and how these factors intersect with race and gender. Based on data from the National Longitudinal Survey of Youth, the report compared the economic status of youths who lived in their parents’ homes in 1979 to their economic status in 2004 and 2006, at 39 to 44 years of age.

The report defines “middle class” as being between the 30th and 70th percentiles of adjusted income distribution and employs three metrics to gauge downward mobility: falling below the 30th income percentile; falling 20 or more percentiles below one’s parents’ rank; and having real income 20 % or more below parents’ income.

The report’s key findings include:

• Married men and women are less likely to lose their middle-class status compared to divorced, widowed, separated, or never-married individuals. Individuals with a post-secondary education are similarly less likely to become downwardly mobile.
• Women experience downward mobility at a higher rate than men, particularly among whites: 30% of white women lose their middle class status, compared to 21% of white men.
• Race does not appear to be a factor in downward mobility for women.
• Black men are more likely to lose their middle class status than white and Hispanic men. The number of black men raised in the middle class who lose their middle class status as adults (38%) is nearly double the share of white men who do so (21%).
• Differences in family background, educational attainment, marital status, and especially test scores explain the race gap in downward mobility among men. However, none of these differences explain the gender gap in downward mobility among whites.
• Low scores on the Armed Forces Qualification Test (AFQT) and drug use both positively correlate with downward mobility.

The report suggests areas for continued study, including the impact of differences in AFQT scores and gender. “Because the AFQT scores explain a large portion of the black-white difference in downward intergenerational mobility, it is important to better understand why AFQT scores differ so substantially, even among youth raised in middle class families,” the researchers state. “Further, future research should explore why racial and ethnic differences in downward intergenerational mobility are confined to men and not women.”

Tags: poverty, African-American, Hispanic, Latino, poverty, race