Foreword

Abstract

Thriving middle classes are the backbone of democratic societies and strong economies, but in many OECD countries they face mounting pressures as a result of stagnating incomes, rising expenditures, and greater labour market uncertainty. As evidenced in the OECD report Under Pressure: The Squeezed Middle Class,published in 2019, middle incomes have been growing much more slowly than high incomes for more than three decades. Over the past 30 years median incomes increased by a third less than the incomes of the richest 10% across the OECD, while the incomes at the very top have surged in many countries. Sluggish income growth coincided with an increase in the costs of a middle‑class lifestyle. Across the OECD, prices for housing, health, and education have risen faster than inflation. Meanwhile, labour market trajectories have become more uncertain. Rapid integration of global supply chains, fast and transformative technological change, and population ageing have resulted in labour market polarisation, and one‑in-six middle‑income workers are employed in jobs that face high risk of automation across the OECD on average.