Can Part-time Work Buy a Middle-class Standard of Living?

But if you are content with the standard of living of the 19th century’s middle class, you could probably do that while working half time right now. That’s an off the top of my head guess. I think I’ll have to do a little research and see if that holds up.

That’s a comment I made on my last substantive post at the League of Ordinary Gentlemen, and the answer is clearly, yes, you can. In fact, as I’ll show, you can live a 1950s middle class lifestyle while working part-time at contemporary American wages.

The idea for the comparison was stimulated by discussions about the alleged disappearance of the middle class. I say “alleged” because I’ve been hearing that prediction since I was a child in the ’70s. At the time I was living near Fort Wayne, Indiana, which was hard hit by recession in the ’70s and ’80s, so the prediction was easy to believe. But though I keep hearing about it, I have yet to see it. Liberal social critics claim to see it, but most economists don’t. Economists work better with data, so I’m more inclined to trust their conclusions.

But it seems to me that part of the problem is that as the country becomes wealthier, it doesn’t seem to become easier to live a middle class life. And it seems to me that this is because the material standard of living that defines the middle class today is higher than that which defined the middle class in past generations. For example, in the 1950s, a middle class lifestyle meant a window air conditioner and some fans to move the air around; today it means central air conditioning. Back then a single car family was middle class; today most middle class families are two car families. A single television set was sufficient to be middle class back then; today–even though televisions are much cheaper–most middle class families have multiple televisions, many pay extra for a television that’s much larger than what their (grand)parents had, and most pay extra–sometimes a lot extra–for cable or satellite (i.e., once upon a time three free channels was middle class; now 100 pay channels is middle class). They didn’t pay for microwaves and computers (and internet access) in the 1950s, while we do now. We also eat out a lot more today than they did back then. One of the biggest changes is the size of American homes. In the 1950s, the average home size was just under 1,000 square feet; today it’s over 2,300 square feet. As importantly, a house back then most often had a single bathroom; now homes regularly have 2 1/2 baths or more.

All this extra material wealth is a good sign, from a strictly economic point of view,* because this means our middle class can afford more than our grandparents’ middle class. Our middle class has a higher standard of living, is better off, than our grandparents middle class. But as commenter E.C. Gach’s question, “Will we (human race) ever have competed enough in the rat races to have a future where our children can have their needs met while only working part time at the “low end” job?”

That’s a good question, but it’s confounded by the fact that we never stop raising the bar that defines middle class. So what if we freeze middle class at some point in time? In my first thought I said the 1900s. But just because the data’s easier to find, let’s start with a 1950s middle class lifestyle. That is, we’ll limit ourselves to those things that satisfied a middle class lifestyle in the 1950s, ignoring the additional demands we have today, and estimate how much an average wage worker would have to work today to have that lifestyle.

1,000 Square Foot Home**
The average cost to build a new home in the U.S. is about $125/square foot. Of course that will vary by region, and will cost a lot more in California, and probably substantially less in, say, Nebraska. But $125,000 gives us a rough starting point. But a new home wasn’t considered necessary for a middle class lifestyle, although in the 1950s there was a real housing boom, so let’s consider what a pre-existing home might cost. Using my own state, Michigan, is a bit of a cheat, so let me look at homes in Fargo, ND.*** Realtor.com lists 5 houses with 3-4 bedrooms and 1 bath, between 800 and 1,600 square feet,**** with an average price of ~$77,500. So for somewhere between $75 and $125k you can buy a 1950s middle class house.

Comparing prices: Using data from the Census Bureau, we can estimate the average North Dakota home price in 1955 at ~$40,500, and for the U.S. at ~$51,600. Using the Bureau of Labor Statistics’ inflation calculator, in today’s dollars those prices are $330,000 and $421,000 respectively. That sounds too high to me, and I want to be conservative and give the 1950s the benefit of the doubt, so I’m going to use a lower number from fiftiesweb.com; $22,000. Adjusted for inflation, that’s $179,600 today, which seems a fair price for comparison. So even if we’re buying a new 1,000 square foot home, we can get for somewhere between 38% and 70% of the cost to a 1950s homeowner, and if we buy used, we can do even better.

One Car
Let’s not quibble about what kind of car a middle class person needs. Obviously people in the 1950s weren’t driving SUVs and minivans, but mostly sedans. But I won’t insist that a sub-compact is satisfactorily middle class. Let’s just take the average (I assume it means mean) price of a new car in the U.S., $28,400, to define our upper end. Then let’s choose for the lower end, a popular used, but not too used, car, say a 2006 Chrysler Town and Country, with 80,000 miles.***** Kelly Blue Book lists the private party value of such a van, in excellent condition, as $8,700. So for between $8,700 and $28,400 you can be a middle class car owner.

Comparing prices: I can’t find an authoritative source on new car prices in the 1950s, but using numbers from several popular websites, I estimate an average of ~$2,050. In contemporary prices that equals $16,738, about the price of a Chevy Cruze, so depending on whether you buy new or used, you can spend less than your grandparents did on a car. (Keep in mind that new car is far higher quality, both in mechanical reliability and especially in safety, than your grandparents’ car, so you’re actually getting more for your money.)

One television
This is where a person can really do better than their grandparents. For this one, I’m just going to go with the television I considered buying when ours went out in the middle of the World Cup last summer (fortunately we ended up buying a used one from a friend for $25, keeping alive my streak, at age 45, of never having bought a new TV–and I am most definitely middle class). It was at Sears, it was a 19″ LCD television for $170. Sure, you can get a bigger or a better TV, but that’s already a better television that Ma and Pa had, so it’s plenty good enough.

Comparing Prices:says a television cost $100 in 1955, but gives a price of $199. Let’s give the benefit of the doubt to the fifties and take the lower price. In today’s dollars, that $100 is $816, about the size of a 50″ plasma screen! So if you’re going to stick closer to a 1950s standard of living, you can get a TV for about 1/4th the cost of what it would cost in the 1950s.

Adding Up
OK, so those are the three major purchases for a family in the 1950s. We’re going for a 1950s middle class lifestyle, so there’s no computer, no XBox, no stereo surround sound system. (Go ahead and buy an MP3 player though, though, as it’s cheap, and download music at work; or buy a cheap CD player (under $50)).

At the low end, you’ll spend ~$86,500. At the high end, ~$153,600. The 1955 adjusted prices (using the lower home price estimate) is ~197,154. So we’re doing better today than gramps, at least in terms of costs–we’re paying between 44% and 78% of what he paid. But what about wages?

Wages
Based on this historical document from the U.S. Census Bureau, average family income in 1955 was ~$4450. In today’s dollars that’s $36,331.

Median household income today is actually $52,000. Notice that’s median, not mean, so it’s not skewed by high-end salaries. The numbers may not be quite directly (family vs. household, and median vs. “average,” which is presumably a mean), but they should be comparable enough, and what it shows us is that the average income today is 40% higher than the average from 1955. But remember that we’re paying less than in 1955, so how much would we need to make to match their standard of living? Well, between 44% and 78% of what he made, or–in today’s dollars–$15,998 to $28,338. In other words, somewhere between a third and a little over a half of today’s median wage.

So can we be middle class while working part-time? Sure, if we can resist the temptation to define middle class by today’s standards. Of course middle class always is defined by contemporary comparisons, which increase constantly over generations, so we’ll never be able to work part time at an average salary and be middle class in compared to our contemporary world. But can you live comfortably on a part time salary? Sure, if your needs aren’t too great. Particularly if you’re satisfied driving used cars (which is clearly a more cost-effective choice most of the time) and you don’t feel the need for a house that will impress all your friends.

Obviously I didn’t cover everything that we could consider. I didn’t consider whether food costs have gone up, but since part of today’s middle class lifestyle is to eat out regularly, or pay high prices for Schwans to deliver meals to you, if you just cut that out and cook at home you’ll be able to eat for far less than the average middle class person over the course of a year. Some people will point to the price of college, too, but a) it’s a fairly new thing for the middle class to think it’s the parents’ responsibility to pay for college, and b) community college is still comparatively cheap, as are regional public schools, compared to private and major public universities. Yeah, if you want to become Secretary of State, you might want to go to Yale, but most people will do fine with two years of CC, then finishing at Central Southeastern State U. Remember, the issue is not whether you can have everything while working part time–it’s whether you can have a 1950s middle class lifestyle while working part time. And it looks to me like you can.

Now if we were to talk seriously about a 19th century middle class lifestyle…

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*I share the doubts of many left-wingers–and some right-wingers–about whether this material wealth is really “good” for us, but let’s leave that aside for this post.

**It’s worth noting that there are a number of localities where you cannot get a permit to build a house that small anymore. What used to be considered middle class is now considered insufficiently middle class to even be allowed by local governments.

***Because home prices are not reported by square footage, we can’t just take a national average home price for 1,000 square foot homes. So I’m choosing a single, hopefully representative enough, market, so I can check its real estate listings. Fargo seems like a fair–albeit not random–choice because it is not an uncommonly expensive market, like major urban areas, but because the economy is currently strong there it’s not a depressed housing market, either. And doesn’t the name of Fargo just instantly bring to mind the iconic conception of middle class America?

****For god’s sake, Fargo has an unemployment rate under 5% and charming 1,600 square foot houses for under $100k–why the hell aren’t people moving there!?

*****Believe me there’s a lot of those out there. I have a hell of a time distinguishing mine in a parking lot because there’s usually three others within my line of sight. And we bought ours a few years older and with considerable more mileage, so I’m not trying to cook the figures by lowballing too much.

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About J@m3z Aitch

J@m3z Aitch is a two-bit college professor who'd rather be canoeing.
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9 Responses to Can Part-time Work Buy a Middle-class Standard of Living?

  1. How would healthcare costs, food prices, and taxes factor in to this assessment?

  2. the innominate one says:

    Let me know if this is pointless pedantry, but the 19th century would be the 1800s, yes? Unless you meant 20th century, your comparisons are using the wrong values.

  3. James Hanley says:

    Pierre–I want to develop this into a publishable piece that takes account of those things. I found those numbers harder to find (well, taxes are probably easy, but I was just tossing off a quick piece), so I let them slide for the moment.

    Innominate–In my original comment I threw out “19th century,” but after a little more thought I decided people would probably find the 19th century to be too unsatisfactory (no indoor heating other than wood stoves!), the numbers would be harder to find quickly, and, finally, I’m not sure if “middle class” was a meaningful concept in 19th century America or not. The 1950s seemed like a good starting point, something we can relate to better.

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  5. steven tanner says:

    The census values for housing are adjusted to year 2000 dollars.

  6. James Drake says:

    In the 1950s a doctor occasionally visited our entry-level, house in the suburbs. How much would that cost now?

    Also in the ’50s the consequences of third-party payment for medical services had not yet driven the cost of them up so high, so it wasn’t necessary to be in a health plan. What part-time work will get you a health plan sufficient to protect a retirement nest-egg?

  7. James Hanley says:

    James,

    I didn’t address health care in this post because it’s a complex topic that I couldn’t yet do justice to. I can only note that while you can’t get house calls now, access to good health care is more widespread than it was in the ’50s. How the cost/benefit analysis of that works out in comparison with the ’50s I can’t say.

    Of course if you only work part time you may qualify for Medicaid, but that’s not exactly the line of analysis I had in mind.

    And if there’s really only one sector of the economy that’s causing the problem, since everyone seems most concerned about health care, that suggests that overall the middle class is in fact doing well–there’s a single sector that’s problematic for them.
    That makes the policy fix somewhat simpler. Certainly if we went to a single-payer plan as most liberals want, we’d eliminate what seems to be the sole serious problem for the middle class.

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