More Americans than ever—31%—are members of upper-middle class: study

In total, around 31 percent of all US households in America are now classified as upper-middle class, according to research done by AEI. At the same time, the "core" as well as "low" middle class have declined at the same time. Despite talk of the hollowing out of the middle class that both sides of the aisle engage in at times, the economy has allowed more people in the middle class to earn more.

The research shows that as households have been moving up the income ladder, they are spending more as those in the lower class are pulling back, which has become known as the "K-shaped" economy.

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"The whole distribution of Americans, from poor to rich, has done better over time. And to the extent that fewer people are within a fixed income range that we might think of as middle class, that's just because everybody's gotten richer over time," Scott Winship, a co-author of the report as well as a senior fellow at AEI, told CBS News. The report studies the incomes of households between the years of 1979 and 2024.

The AEI classified those earning between $153,864 and $461,592 for a family of four as upper-middle class. The share of rich households has also grown from 0.3 percent of all households to 3.7 percent.

Although the findings may be contrary to narratives around the economy, Winship said that there appears to be a discrepancy when you ask people about their individual finances versus the US economy as a whole.

"When you ask people about their own families, their own personal financial situation, you get much, much larger shares of people who say that they're doing fairly well," he stated. However, larger ticket items such as housing, education, and other services have outpaced inflation in terms of costs, leading to a tighter pinch for many Americans.

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