Social Mobility in America

Economic turbulence has overtaken the American way of life.  In Europe and Asia, investors stand uncertain of their next moves.  Even America is part of an economic casualty. 

Yet, these problems are very personal to the average citizen. Higher gas prices and costs of living; the housing bust; and the financial crisis cause most people to worry about their future. With a weak job growth, many U.S. jobs continue to be shipped abroad. 

Global competition continues to cause Fortune 500 companies to search for cheap labor to increase profitability.  This reality often places developed countries like the United States at a clear disadvantage.  Consequently, there has been an increasing gap between the wealthiest people and the poorest people in this country.  The reality has become the shrinking or disintegrating of the middle class.

America is a shining symbol for social mobility across the world.  Social mobility can be defined as “the passage of individuals from one social class to another.” Most people feel that if they work hard, they can achieve a better life, regardless of their social standing. 

In some countries, a person is stuck in an economic class with no hope of further advancement.  If your parents are uneducated and work a low paying occupation, the children will grow up in this same status.

Marketing expert Michael Solomon argues the natural progression of social mobility: “People do improve their positions over time, but these increases are not usually dramatic to catapult them from one social class to another.”  The current economic picture makes social mobility more difficult.

Michael Snyder, editor of, argues the systematic destruction of the middle class: “The rich are getting richer and the poor are getting poorer at a staggering rate. Once upon a time, the United States had the largest and most prosperous middle class in the history of the world, but now that is changing at a blinding pace.” 

Snyder supported his claims with 22 statistical facts.  Below is a sample of his analysis:

  • Eighty three percent of all U.S. stocks are in the hands of one percent of the people.
  • American workers now must compete against situations like China where a garment worker makes approximately 86 cents an hour and in Cambodia a garment worker makes approximately 22 cents an hour.
  •  Sixty one percent of Americans “always or usually” live paycheck to paycheck, which was up from 49% in 2008 and 43% in 2007.
  • Average Wall Street bonuses for 2009 were up 17% when compared with 2008.
  • More than 40% of Americans who actually are employed are now working in service jobs, which are often very low paying.
  • Sixty six percent of the income growth between 2001 and 2007 went to the top one percent of all Americans.
  • Only the top 5% of U.S. households have earned enough additional income to match the rise in housing costs since 1975.
  • In 1950, the ratio of the average executive’s paycheck to the average worker’s paycheck was about 30 to 1. Since the year 2000, that ratio has exploded to between 300-500 to 1.
  • As of 2007, the bottom 80% of American households held about 7% of the liquid financial assets.
  • The bottom 50% of income earners in the United States now collectively own less than 1% of the nation’s wealth.

Many people hold that a political change will rescue the middle class.  As we have witnessed in the 2012 Presidential Election, petty politics are more important than solving the economic crisis.  Therefore, all families are held hostages. Any rescue will not be soon. 

Snyder doubts there is any hopeful solution for the stale social mobility occurring today: “The reality is that no matter how smart, how strong, how educated or how hard working American workers are, they just cannot compete with people who are desperate to put in 10 to 12 hour days at less than a dollar an hour on the other side of the world.”  Many people hope that America can compete in the future without sacrificing her core values related to social mobility.  Others have given up this hope.

 Do you feel social mobility is unsustainable in the U.S. , given global competition?

 © 2012 by Daryl D. Green