The American middle class is shrinking.
A Fortune investigation in December found that American workers today have the largest amount of consumer debt ever measured, less purchasing power than their 1973 counterparts, and higher odds of living paycheck-to-paycheck than in 2013.
Another angle on the issue: The country's three richest people--Jeff Bezos, Warren Buffett, and Bill Gates--are collectively wealthier than 50 percent of the U.S. population, according to a 2017 Institute for Policy Studies report.
You're likely to hear a lot more about these points as the 2020 presidential campaign takes shape and candidates pitch their ideas for addressing income inequality. Regardless of your preferred solution, a disappearing middle class is an economic indicator any entrepreneur should watch. It doesn't bode particularly well for consumer spending--if your customers don't have money to spend, they can't spend it with you.
Some locales are suffering worse than others. On Tuesday, 24/7 Wall Street released a ranking of states according to the decline of middle-class households, as measured by U.S. Census Bureau microdata. Here are the top five that have seen the biggest declines since 1999:
- New Hampshire
- Rhode Island
Many of the country's biggest startup hubs are seeing the biggest declines. California is No. 23, for example, and New York is No. 14. You can find the full list and where your state ranks here.
Here's what else I'm reading today:
- Lyft's IPO could happen as early as next week. --The Wall Street Journal
- The U.S. Securities and Exchange Commission wants more companies to follow that example--and has a new plan to persuade them. --Inc.
- Super-apps, oat milk, and the National Basketball Association: These are the most innovative companies of 2019. --Fast Company
- Elon Musk returned to his questionable tweeting habit, and Tesla's general counsel promptly resigned. --Bloomberg
- The final days of Theranos were even crazier than you thought, from nine different law firms on retainer to an unhousebroken puppy running amok. --Vanity Fair
- Pinterest hasn't been part of the conversation around social networks and misinformation--until now. --The Wall Street Journal
- If you're still buying print and television ads, you're doing it wrong. --The Washington Post
- Is your phone always low on battery and chewing through data? The "DrainerBot" could be to blame. --The Washington Post
- Bank robbers who escape on e-scooters are increasingly common--and extremely easy for police to catch. --Quartz