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Utah has a larger middle class proportionally than most of the rest of the country, and that share has increased slightly in recent decades.
The Beehive State has a diverse middle class — including about half of the state’s population that identifies as Hispanic or Latino and more than 40% of every race group — that makes up about half of the state’s population, according to a fact sheet from the Kem C. Gardner Policy Institute.
But that doesn’t necessarily mean people who make enough to qualify as part of the middle class feel the security traditionally linked with the label, panelists said Wednesday morning.
Housing is the biggest reason for that, said Bill Crim, president and CEO of the United Way of Salt Lake.
“Young people who grew up solidly middle class and maybe even have gone onto post-secondary education feel like and maybe legitimately don’t have much of a chance to buy a home and start to do the thing that provides an aspect of middle-class ability, which is asset accumulation,” Crim said during the panel discussion at the Gardner Institute in Salt Lake City.
The event focused on the middle class in Utah and was co-sponsored by The Salt Lake Tribune and Gardner, as part of their quarterly “Storytelling Through Data” conversation series.
Utah’s middle class has been “fairly stable,” said Levi Pace, a senior economist at the institute.
However, housing affordability could be a long-term “ticking time bomb” threatening that stability, Crim said.
Households throughout the community are overburdened by housing costs, said Christine Richman, the principal at GSBS Consulting, a firm working with the city to reenvision Smith’s Ballpark.
Those costs puts their housing and stability at risk if there is an unexpected health emergency, car repair or other major cost, she said.
If the state wants to continue having a strong middle class, panelists said, Utah policymakers need to work to build broad resiliency, give people opportunities to get people into post-secondary education and pull together to work to solve the state’s housing crisis.
Utah’s middle-class population higher than country
Economists at Gardner blended two income-based approaches — a percentage of median household income and percentiles related to the federal poverty level — to define what incomes fall into the middle class.
Based on that, the institute defines middle class as a person making between $24,500 and $64,600, or a family of four with a household income between $70,700 and $166,400.
About half of Utahns — 1.6 million people — were in the middle class by that definition in 2022, according to the institute’s report. That was up from 1.3 million people in 2020.
But the proportion of Utahns making middle income is down from the start of the new millennium.
More than 51% of Utahns were middle class in 1980, and more than half made a middle income in 1990 and 2000. That dipped to 48.2% in 2010 and has been slowly increasing — to 48.9% in 2020 and 49.1% in 2022.
Utah’s rate of middle-class residents, while lower than in past decades, is still higher than the national rate of 45% and is among the top states, based on Gardner’s analysis.
A Business Insider study that used a different method to define “middle class” found 58.3% of Utah households were in the middle class. That was second in the country and only slightly behind South Dakota, with 58.7% of households.
Who is middle class in Utah?
The state’s middle-class population is diverse.
More than 40% of Utahns in each race group fall into the middle class, and half of Utahns who identify as Hispanic or Latino are in the middle-income group, according to the Gardner Institute analysis.
The fact sheet notes that while Utahns identifying as Hispanic or Latino have the highest portion of middle-class people, they also are overrepresented in the state’s lower class, along with Black and Native American residents.
Meanwhile, Utahns identifying as Asian and white with no Hispanic or Latino heritage have the highest shares in the upper-income category.
Housing costs and education
Though Utah’s diverse middle class is holding steady, some things could threaten that. Rising housing costs, for one.
A recent analysis by The Tribune of U.S. Census Bureau and real-estate industry data found that the average renter can only truly afford to buy a home in Beaver County. Even the highest middle-class salary for an individual — $64,600 — would only allow someone to buy a home in Emery and Beaver counties.
Richman said renters also are typically cost-burdened — meaning more than 30% of their income goes to housing.
That means parents working more jobs, she said, and kids who grow up less connected to their family.
“It seems to snowball from there, in terms of school performance,” Richman said.
As GSBS Consulting talks with people in the Ballpark neighborhood, Richman said, they hear again and again that people want their core needs for a happy life met:
Enough pay to cover basic expenses.
Time to spend with family and neighbors.
Opportunities to build relationships.
Health and the chance to get out into nature.
Respect within their community.
There are simple ways to solve some of those, she said, like creating green space where there aren’t parks and improving walkability in neighborhoods with connectivity issues.
Others — like “investing in opportunities for households to work at living-wage jobs” — will take more work.
A need for action over talk
Utah also needs to act like — not just say — it’s in a housing crisis and pull together to work on the problem, Richman and Crim said.
Everyone talks about the need for attainable housing, Richman said, but people end up pointing fingers at developers for making too much money, cities for not changing zoning or the Legislature for not passing housing policies.
Crim added that part of the problem is the Legislature “overwhelmingly” hears from people who are the most secure in their housing situation. They want the problem solved, he said, but they don’t want multi-family housing in their backyard.
Beyond coming together to solve the housing crisis, Utah policymakers also need to support teachers and schools to do their best work, Crim said.
That means not waiting for “data at the end of the year to tell us we didn’t make much progress,” he said, but instead monitoring the numbers monthly.
It also means setting children’s aspirations high early, he said.
The United Way of Salt Lake works to set a four-year degree as the goal for children in elementary school, Crim said, then start to individualize goals for students who might be better off getting a certificate or a two-year degree.
That’s key because Utahns with four-year degrees generally make more than their peers who didn’t graduate from college.
Crim said the state also needs to work to build broader resiliency, especially around health care.
Health care costs can hurt everyone, he said, and even people with coverage can go into debt and a downward spiral if they can’t afford their co-pay or deductible.
Richman suggested looking at how households survived the pandemic to see what things the state can do to help Utahns weather other issues.
Megan Banta is The Salt Lake Tribune’s data enterprise reporter, a philanthropically supported position. The Tribune retains control over all editorial decisions.
Follow @MeganBanta_1