By: Richard Partington of The Guardian
Millennials in advanced economies around the world are being squeezed out of the ranks of the middle class, including in Britain, as pay growth stalls and house prices skyrocket, according to the OECD.
The Organisation for Economic Co-operation and Development (OECD) said that for every every generation since the baby boom of the 1940s, across 40 major countries, the middle-income group had shrunk and its economic influence weakened.
The Paris-based organisation, which represents 36 wealthy nations around the world, but also included South Africa, China, Russia and Brazil in its analysis, said there had also been a noticeable decline in the living standards of middle-income families over the past three decades.
It said there were 15 countries where the middle class was now a smaller group than before the financial crisis; the group was defined as people whose earnings are between 75% and 200% of median national income. It also found that the top 10% of earners held almost half of the total wealth, with the bottom 40% accounting for only 3%.
The snapshot of modern life for middle class households around the world suggests that younger generations are increasingly being denied similar opportunities to their parents.
As many as 70% of the baby boomers – born between 1942 and 1964 – were part of the middle class in their 20s, compared with 60% of millennials – born between 1983 and 2002 – at the same point in life, the OECD said.