"My salary does not keep up": The plight of so many in the middle class

By Aimee Picchi

/ MoneyWatch

Basic universal income: Testing a weapon against economic insecurity

Coming up with $400 to cover an emergency expense might seem doable for a middle-class family, but one-third of them couldn't cover that last year. Their experience of financial insecurity underscores their financial fragility despite a growing economy, according to a new study from the Urban Institute.

These middle-income families earn between $40,840 and $81,680 for a family of three, reflecting the level of income that would place them inside the middle class. But their struggles with financial insecurity highlight how a solid income isn't always enough to cover expenses such as rising rents and health care. The Urban Institute's findings are based on a survey of more than 7,500 adults age 18 to 64.

A decade of economic expansion has tended to favor the wealthy over the middle class, and many of the jobs that have been created since the Great Recession offer meager pay and benefits, Heather Boushey, chief economist at the Washington Center for Equitable Growth, told a Congressional panel on Wednesday that examined the financial struggles of the middle class.

Middle-class Americans increasingly rely on the safety net

Tatum Tirado, a former Marine and single mother of two children, told the panel she struggles with covering her costs on her salary as a Washington, D.C., school teacher.

"I've devoted my life to public service and volunteer teach and tutor when I can," Tirado told the panel. "And yet still I struggle! How do I provide for my family or feel confident I am climbing the ladder to live the middle-class lifestyle so many of us aspire to, when everything continues to get more expensive — but my salary does not keep up?"

Tirado said she lives in a 600-square-foot apartment with her two daughters and can't afford to buy a home in the D.C. area because of high housing costs.

Rising expenses

Tirado has plenty of company, based on the Urban Institute's findings. The high rate of financial insecurity among middle-class families reveals that the problems extend beyond income, said K. Steven Brown, research associate in the Center on Labor, Human Services and Population and the Research to Action Lab at the Urban Institute.

"We were certainly surprised by the percentage of families, especially moderate-income families, that are struggling with financial insecurity," Brown said. "There are rising health care costs, housing costs — all those things present challenges for families, even middle-income families."

Families that experience a setback like a big medical bill or an expensive car repair may struggle to get back on solid footing, Brown noted. Unequal growth in wages is only one of the forces slamming middle-class families, according to Washington Center's Boushey. Expenses for child care and health care have skyrocketed in the past few decades, she noted.

"As incomes have stagnated, the building blocks of a stable middle-class living have steadily become more expensive," Boushey told the Congressional panel. "Health care, child care and education are a few of the fundamental but increasingly unaffordable pillars of the American dream."

Working, but not enough

One surprising finding in the Urban Institute data is that almost one-third of families with two working adults struggled with material hardship in the past 12 months, such as failing to make a mortgage or rent payment.

To be sure, unemployment stands at a record low, and American employers posted the most open jobs in December in the nearly two decades that records have been kept. But not all these jobs are the type of good-quality positions that include benefits and wage growth.

In fact, about one-quarter of the workers surveyed by the Urban Institute said they wanted to work more, but couldn't. The reason? About half cited their employers' scheduling practices or restrictions on their hours.

"There has been incredible growth of jobs," Brown noted, "but also incredible growth of not-so-great jobs."

First published on February 14, 2019

© 2019 CBS Interactive Inc.. All Rights Reserved.

"My salary does not keep up": The plight of so many in the middle class

Even families with two working adults struggle to pay rising costs for necessities, never mind covering emergencies

updated 1M ago

Atmospheric River, record snow: Extreme weather slams West Coast

The extreme weather is due to a powerful Pacific Ocean jet stream pattern: Part of the polar jet stream is angled straight south along the U.S. West Coast from Alaska

4H ago

These dogs went speed dating to find their perfect match

This Valentine's Day, even dogs are looking for love

2H ago

Ryan Adams accused of emotional abuse, sexual misconduct

In one allegation, a 20-year-old female musician said Ryan Adams, 44, had inappropriate conversations with her while she was 15 and 16

4H ago

Historian: New Deal faced similar backlash as Green New Deal

Steve Fraser said President Franklin Roosevelt's "New Deal" reforms were also accused of being far-fetched socialist proposals

6H ago

Congressional bargainers present bill to fund government

According to summaries of the bill, it includes $1.375 billion for 55 miles of bollard fencing

2H ago

Historian: New Deal faced similar backlash as Green New Deal

Steve Fraser said President Franklin Roosevelt's "New Deal" reforms were also accused of being far-fetched socialist proposals

6H ago

Trump installed $50K golf simulator system in residence

A White House official said President paid for the installation personally, but has not yet used it

7H ago

Illinois lawmakers pass two bills to "modernize" abortion laws

The bills are part of a handful around the country that addresses abortion, spurred by uncertainty surrounding the fate of Roe v. Wade

7H ago

Omar, Venezuela envoy clash on U.S. meddling in Latin America

Elliott Abrams, the State Department's special representative to Venezuela, was involved in controversial foreign policy decisions during the Cold War

6H ago

Philippine journalist posts bail, calls for "outrage" over libel arrest

"What we're seeing is death by a thousand cuts of our democracy," Rappler CEO and editor Maria Ressa says after release

1H ago

Omar, Venezuela envoy clash on U.S. meddling in Latin America

Elliott Abrams, the State Department's special representative to Venezuela, was involved in controversial foreign policy decisions during the Cold War

6H ago

House passes bill to limit U.S. involvement in Yemen

The Trump administration has provided military assistance to the Saudi-led intervention in Yemen

11H ago

Prada forms diversity council after blackface outrage

The move follows accusations of racism in the luxury fashion world

12H ago

African black leopard captured in rare photos

Will Burrard-Lucas​ snapped these stunning photos of the wild leopard during a safari in Kenya

11H ago

Ryan Adams accused of emotional abuse, sexual misconduct

In one allegation, a 20-year-old female musician said Ryan Adams, 44, had inappropriate conversations with her while she was 15 and 16

4H ago

These A-listers are the most stylish stars, according to People

Ahead of the Academy Awards, People has released its list that also includes Emma Stone, Nicole Kidman, Donald Glover

10H ago

Disney reveals first look at "Frozen 2"

Fans get their first look at the highly-anticipated "Frozen 2," and it appears the cast is far from where they started

13H ago

3 women share role of Cher on Broadway. They call it "Cherapy."

The lead role is played by three actresses who represent the different stages of Cher's life

16H ago

George Clooney defends Meghan Markle after treatment by press

"I believe she cried more to do with the press intrusion than anything else in her life," Prince William has said about their mother, Diana, Princess of Wales

19H ago

Atmospheric River, record snow: Extreme weather slams West Coast

The extreme weather is due to a powerful Pacific Ocean jet stream pattern: Part of the polar jet stream is angled straight south along the U.S. West Coast from Alaska

4H ago

Apple lawyer who oversaw insider trading policy charged with insider trading

Former attorney at the tech giant allegedly drew on non-public earnings information to cash in

12H ago

Rover bites the dust on Mars, ending 15-year mission

NASA officially terminates the Mars Opportunity mission eight months after losing contact with the rover

9H ago

African black leopard captured in rare photos

Will Burrard-Lucas​ snapped these stunning photos of the wild leopard during a safari in Kenya

11H ago

T-Mobile, Sprint CEOs insist merger would benefit consumers

Proposed $26 billion union of U.S. wireless carriers would lower costs and create jobs, executives say

13H ago

CDC warns about potentially contaminated raw milk

A dangerous drug-resistant bacteria is connected the consumption of raw milk​ in 19 states

11H ago

Eating these kinds of foods may cut your life short

New research suggests certain foods high in salt, sugar and other additives may increase the risk of early death

11H ago

Depression during and after pregnancy can be prevented, panel says

Up to 1 in 7 women experience what's called perinatal depression, and a task force has issued new recommendations to help prevent it

18H ago

Drugmaker behind ibuprofen recall has history of FDA violations

Federal watchdog previously found significant violations of manufacturing rules by Tris Pharma

18H ago

How to confront rising anxiety among young girls

Psychologist Lisa Damour offers practical advise on how adults can help address the "unique pressures" girls face

22H ago

"My salary does not keep up": The plight of so many in the middle class

Even families with two working adults struggle to pay rising costs for necessities, never mind covering emergencies

updated 1M ago

5 problems with a $22 trillion national debt

There's no precedent for debt this high during an economy this good, raising several troublesome issues

10H ago

Record number of Americans behind on car loan payments

There are now 1 million more people behind on payments by three months than there were in 2010

4H ago

Prada forms diversity council after blackface outrage

The move follows accusations of racism in the luxury fashion world

12H ago

Apple lawyer who oversaw insider trading policy charged with insider trading

Former attorney at the tech giant allegedly drew on non-public earnings information to cash in

12H ago

Apple lawyer who oversaw insider trading policy charged with insider trading

Former attorney at the tech giant allegedly drew on non-public earnings information to cash in

12H ago

Gunman kills wife at dentist's office, gets shot by bystander

Armed bystander shoots gunman, detains him, waits for police to arrive, police say

14H ago

White supremacist gang in Arkansas accused of brutal tactics

Group called "reprehensible in its admiration for Nazi imagery and racist views, but even more alarming are the crimes and violence perpetrated by these defendants"

12H ago

Ohio State student and her kidnapper killed in police chase

Female student from Ohio State University campus, man suspected of abducting her both die after police chase, shooting

12H ago

One year after Parkland shooting, survivors continue push for change

Survivor Lauren Hogg tells CBSN activism "gives me a reason to get up every single morning"

15H ago