Many have noted that Walmart is buying up hipster brands as part of its moves in online commerce and so on. The implications of that for the retail industry are for my colleagues on the retail desk of course. But it would be an odd idea that a mass market retailer moving upmarket is evidence of the death of the American middle class. If more people have more money to spend on hipster clothing that would appear to be evidence that the middle class has more money, not that it's dying away. And that's what is actually happening to American incomes too, more people are graduating up out of the "middle class" in income terms. Thus this from Business Insider is a little odd:
The addition of more "upscale" merchandise demonstrates the changes that the discount retailer has been forced to make as the number of potential middle-class customers plummets. Between 2000 and 2014, middle-class populations decreased in 203 of the 229 metropolitan areas reviewed in a Pew Research Center study.
That's from this Pew study:
A Pew Research Center analysis of Census Bureau data looked at the state of the middle class in America's metropolitan areas. Pew defined "middle-income" households as those whose income fell between two-thirds and twice the national median household income, adjusted for household size and for the local cost of living in each metro area.
About which, as I pointed out, there isn't that much to fear:
However, let me put something to you. Pew defines this middle class of theirs as people with an income, adjusted for household size and local living costs, between 66% and 200% of median income. More people are living outside this purported sweet spot. Some number are falling below it but the shrinkage of this middle class is more to do with people gaining higher incomes than this band. I really cannot bring myself to fret about people earning more.
People are moving up out of Pew's definition of middle class income. Which rather explains why a mass retailer like Walmart is stocking rather more expensive goods. Because there's more of a mass of people who can afford the more expensive goods.
Think through it for a moment. When the car dealership lots are full of Rolls Royces do we thus conclude that the area is getting poorer? So why would we worry about the American middle class doing so when Walmart starts stocking more expensive clothes?
