Anatomy Of A Decade

&flashquotMost Businessmen Don't Realize It Yet...&flashquot

But the middle class--the principal market for much of what they make--is gradually being pulled apart. Economic forces are propelling one family after another toward the high or low end of the income spectrum. For many marketers, particularly those positioned to sell to the well-to-do, this presages good times. For others used to selling millions of units of their products to middle-income folks, the prospects are altogether darker.

"By almost all measures, the degree of income inequality between rich and poor American families has been increasing. The richest one-fifth of families received nearly 43 percent of the country's total money income last year, their largest share in over three decades. That's more than nine times as much as the poorest fifth took in--vs. 7 1/2 times as much a decade ago. More critically, the broad middle class, defined as families with incomes between $15,000 and $35,000 per year (in constant 1982 dollars), fell from 51 percent of total families in 1973 to 44 percent last year. The extremes on either end, those making less than $15,000 or more than $35,000, grew as a percentage of all families. This trend seems to have escaped the attention of many American companies, even though it has far-reaching consequences for them as employers and as purveyors of goods."

--from a 1983 article by Bruce Steinberg, "The Mass Market is Splitting Apart," included in The Eighties: A Reader

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This article was originally published in the December 1997 print edition of Entrepreneur with the headline: Anatomy Of A Decade.

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