KEY POINTS

  • More than one-half (52%) of U.S. households are currently defined as middle-class – but that figure has declined in recent years
  • A middle-class household is generally defined as one that earns between two-thirds and two times the median national income
  • Utah had the highest percentage of households in the middle class (54.6%) as of 2019

In 2020, Utah is the best state in the country for middle-class families, according to a study by SmartAsset.com.

Taking into account such parameters as percentage of households in the middle class, median household income adjusted for cost of living, median home value, homeownership rate,  and middle-class job growth, among others, the Beehive State came out on top.

A middle-class household is generally defined as one that earns between two-thirds and two times the median national income. Pew Research Center noted that little more than one-half (52%) of U.S. households are currently defined as middle-class – but that figure has declined from 61% in 1971.

Economists attribute that “squeeze” on the middle-class to a fall in real wages and rising costs of housing and consumer goods. This has, in turn, curbed upward mobility and living standards for much of the middle class.

SmartAsset found that Utah, an overwhelmingly white state with a population of just 3.2 million, had the highest percentage of households in the middle class (54.6%) as of 2019, and the lowest Gini index (0.43) – a measure of income inequality. The Gini ranges from zero (perfect equality) to 1 (perfect inequality).

Idaho ranked as the second best state to be middle class in – it has the sixth-highest percentage of households in the middle class (49.9%), sixth-highest homeownership rate (71.6%), and second-highest rate of four-year middle-class job growth (about 42%).

While Utah and Idaho ranked number one and number two, the Midwest dominated the top ten states with five entries: Minnesota, South Dakota, Iowa, Nebraska and Wisconsin. (Indiana, which came in at fifth place in SmartAsset’s survey last year, dropped to 18th this year.)

Minnesota, which ranked third overall this year, features a high median household income adjusted for cost of living ($76,458) and an impressive homeownership rate (71.9%).

New Hampshire and Colorado also jumped to the top ten rankings from last year. Both of these states showed sharp increases in median household income adjusted for cost of living.

At the other end of the ledger, diverse New York state ranked as the worst in which to be middle class. SmartAsset cited the Empire State’s relatively low percentage of middle-class households (43.2%) and low home ownership rate (53.5%). However, New York still had a relatively high median home value of $338,700.

Next to last, according to SmartAsset’s methodology was Louisiana, where only 40.9% of households are considered middle class.

The District of Columbia and Mississippi had the lowest percentage of middle-class households – each just above 39%.