Corporations Tailoring Product Lines To Reflect Growing Income Inequality
As the American economy struggles to shake off a torpor that threatens to drag the country back into recession, the gap continues to grow between the nation’s richest citizens and everybody else.
The economy is in evident peril, with unemployment high, wages falling, the housing market treading water and growth so slow as to be nearly imperceptible. Yet the rich are doing just fine. Some statistics make clear the size of America’s affluence disparity: As of 2010, the richest 20 percent of the U.S. population control 84 percent of the wealth. And the 400 richest Americans have a higher net worth than the full bottom 50 percent of households.
As the wealthy continue to accrue capital — helped by policies like a low tax on profits from stock and real estate sales — and the less well-off classes try to make do in a pitiless economic climate, corporations appear to be finally recognizing the reality of the prosperity gap, and tailoring their product lines accordingly. Manufacturers like Procter & Gamble, the household-goods giant responsible for everything from Charmin and Old Spice to Tide, are concentrating their efforts on luxury and bargain items, putting less emphasis on products aimed at the middle class, the Wall Street Journal reports.
The erosion of middle-market product lines reflects a trend where economic pressures are making it increasingly harder for Americans to maintain a traditional middle-class existence. Jobs are less secure, home ownership rates are falling and a college education is not the guarantee of financial stability that it once was. A recent study from the Pew Charitable Trusts found that more than a quarter of Americans who were raised in middle-class families in the late 1970s had fallen into the lower-earning classes by 2006.