Study: Michigan Ranks Top 10 In Best States For Middle Class
(CBS DETROIT) -- A new study ranks Michigan in the top 10 in Best States for Middle Class families, according to a financial technology company.
The study from SmartAsset released Tuesday ranks the state No. 7, tied with Iowa, followed by Vermont and Indiana. Michigan was previously ranked No. 15 in 2020.
Utah and Idaho rank in No. 1 and 2 respectively.
The study compared all 50 states and the District of Columbia based on seven metrics:
- Percentage of households in the middle
- Median household income adjusted for cost of living
- Media home value
- Homeownership rate
- Gini index
- Four-year changes in both median household income and middleclass job growth.
Read the full list below:
Across all 50 states and the District of Columbia, Utah has the highest concentration of middle-class households (46.62%), defined in our study as households with an annual income between $60,000 and $149,999. Additionally, Utah's Gini index - a measure of income inequality, where 0 indicates perfect equality and 1 indicates perfect inequality - is the second-lowest nationwide, at 0.42.
Utah ranks third-best for its median household income adjusted for cost of living, at about $81,500. In addition, from 2017 to 2021, the number of jobs earning an average salary of $30,000 to $70,000 increased by more than 33% (ranking third-best).
Idaho shows consistency over time, remaining second-best overall in our study. From 2016 to 2020, the median household income in Idaho increased by 21.17%, the fifth-best rate overall. Additionally, the number of jobs earning a middle-class income ($30,000 to $70,000) increased by 31.20% which also ranks fifth-best in our study. The state's income distribution - measured by the Gini index - ties for third-best with an index of 0.44.
3. New Hampshire
Jumping three ranks from the No. 6 spot in 2020, New Hampshire also ranks in the top 10 states for four of seven metrics analyzed. These metrics include the percentage of middle-class households (44.10%), Gini index (0.44), homeownership rate (73.25%) and median household income adjusted for cost of living ($77,966).
New Hampshire falls farthest behind when it comes to median home value. Census Bureau data shows that the state's median home value is $297,800, the 15th-highest in our study.
The Land of 10,000 Lakes ranks fourth-best for its homeownership rate (73.88%), with a median home value of $263,300. Of all the households in the state, our estimates show that 43.10% of them belong to the middle class (ranking fifth-best).
Since 2016, the median household income has increased by 15.13% and when adjusted for the cost of living, the income value is $76,561,10th-best in our study. When measuring income inequality, Minnesota ties for the 11th-best Gini index of 0.45.
Colorado ranks second-best its four-year increase middle-class jobs (39.08%) and eighth-best for its four-year change in the median household income (18.25%). After adjusting for cost of living, the median household income in Colorado is $75,447 (which ranks 12th-best). Additionally, 41.78% of households in this state are in the middle class (ranking 10th-best).
Colorado falls behind for our two housing-related metrics, with the homeownership rate (66.79%) ranking only 36th-best and the median home value ($415,700) ranking sixth-highest.
6. South Dakota
South Dakota ranks as the sixth-best state for the middle class, ranking in the top 15 states for three metrics. It has the 15th-highest homeownership rate (40.69%), sixth-best Gini index (0.44) and fourth-largest four-year increase in middle-class jobs (33.20%). For middle-class individuals looking to put down roots, homes in South Dakota are also relatively affordable. The median home value is 16th-lowest, at $188,900.
7. Iowa (Tie)
Across the seven metrics we considered, Iowa ranks particularly well for housing-related measures. It has the eighth-lowest median home value ($164,000) and ninth-highest homeownership rate (72.46%). Additionally, Iowa ties for the third-lowest Gini index in our study, at 0.44. The median household income adjusted for cost of living is $67,779, 24th-highest in our study.
7. Michigan (Tie)
In Michigan, more than 73% of households own their home, a top 10 rate in our study. The median home value is $179,500, or 13th-lowest across all 50 states and the District of Columbia. We estimate that almost 39% of households in Michigan are middle class, the 27th-highest rate. Finally, the number of middle-class jobs increased by 20.27% (ranking 13th-best) from 2017 to 2021.
Vermont moves up this year, ranking 20th-best overall in the previous version of this study. This Northeastern state ranks eighth-best for two metrics: percentage of households in the middle class (42.03%) and homeownership rate (72.62%).
Between 2016 and 2020, the median household income in Vermont increased by 16.91% (which ranks 16th-best overall). However, as previously noted, the number of middle-class jobs has actually decreased by almost 2% from 2017 to 2021.
Indiana rounds out our list of the top 10 states for the middle class jumping eight spots from No. 18 in our previous study edition. The median home value is $163,500 (seventh-lowest) and 40.14% of households are in the middle class (ranking 20th-best). The homeownership rate is 12th-highest, at 71.39%.
Indiana falls farthest behind when it comes to median household adjusted for cost of living. We found that the adjusted figure is $65,373, the 18th-lowest across all 50 states and the District of Columbia.
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