Colorado’s middle class is rapidly shrinking, according to a new report that raises concerns about growing income inequality in the state.
There’s been a six percent decline in the middle class population since 2000 – the 11th fastest decline in the nation.
The report, released yesterday by the Bell Policy Center, the Colorado Trust, and the University of Colorado Denver, inspects the health of the state’s middle class and looks at who comprises that population.
The report found that in Colorado, a middle class income doesn’t cover the costs of what are typically associated with a comfortable middle class lifestyle – things like the ability to save for retirement and college, own a home, have health care coverage, and hopefully take a vacation every once in a while.
Because wages haven’t kept up with the rising cost of living in the state, families that fall into the middle class income range would have to earn about $20,000 more per year in order to afford this lifestyle.
In 2016, the median income for all family types in Colorado was $59,000, putting the middle-class income range at $38,900 to $118,000.
“This report offers us a much clearer picture of what Colorado middle class families are struggling with and how our communities need to respond with a profound sense of urgency,” said Bell Policy Center president Scott Wasserman in a press release.
For families with children, a middle-class lifestyle is becoming more and more unattainable.
The share of middle income families who have children has dropped significantly in recent years. That’s in part due to the fact that Colorado is the fifth least affordable state when it comes to childcare. Given the fact that middle class families tend to require two adult income-earners, and workplaces seldom offer paid family leave, this can be an especially burdensome expense.
“If we know the tradeoffs families are making to access and maintain a middle class lifestyle, then lawmakers have a better sense of which public policies can help families,” saidGeoffrey Propheter, a professor a the University of Colorado at Denver. “For instance, we know child care is expensive, and programs partially subsidizing daycare provide financial relief for families who might otherwise forego children or make other sacrifices that keep them out of the middle class indefinitely.”
Colorado lawmakers considered a bill earlier this year that would have created a paid family and medical leave program, but the bill didn’t advance past the Republican-controlled state Senate.
The report also highlights Colorado’s housing market. In 2016, the state’s median home value was nearly five times that of the median household income, the seventh highest in the country.