For decades, the United States boasted the honor of having the richest middle-class. However, as of 2015, Canada has the wealthiest middle class of any country in the world.
The most common figure used by researchers and economics professors when comparing middle-class economies across different countries is median annual income, standardized to U.S. dollars. In 1980, the U.S. was the only country in the world with a median annual income above $15,000; Canada was second at just over $14,000, while developed European countries such as Britain, the Netherlands, Norway, Sweden and France all hovered around the $10,000 mark. Some of these countries, such as Norway and the Netherlands, began making steady gains on the U.S. beginning in the 1980s, while others, such as Canada, mostly tracked the U.S.' middle-class growth until the late 2000s, when they started making large gains on the world's superpower.
The Great Recession
While the middle-class incomes of Canada and most Western European countries continued to rise, even during the deep global recession that began in 2009, the U.S. saw its median annual income fall during the late 2000s and early 2010s. The only other aforementioned country to experience a similar decline was Britain. The middle class in Canada, on the other hand, continued to amass wealth robustly during the recession, albeit at a slightly slower pace than in years prior.
As of 2013, the U.S.' economy is still over nine times larger than Canada's. The U.S. gross domestic product (GDP) that year was over $16.8 trillion, while that of its northern neighbor came in at only $1.8 trillion. Middle-class citizens in the U.S. haven't reaped many benefits from their country's economic prosperity during the 21st century. The wealthy have benefited from most of the post-2000 wage growth in the U.S., while middle-class and lower-class wages have stagnated and even declined.
Several factors have allowed Canada to pass the U.S. in middle-class prosperity. First, American educational attainment has dropped precipitously in comparison to other developed countries. While Americans over 55 are highly educated and literate compared to their Canadian and European counterparts, the same cannot be said for those in the 16- to 24-year-old age bracket, who rank near the bottom for all rich countries in educational attainment.
Additionally, the private sector wage gap between high-level executives and entry-level workers is massive in the U.S., especially when compared to Canada and developed European countries. This is why economic indicators such as GDP can be misleading when trying to discern which country's citizens are doing the best economically. The U.S. boasts impressive economic numbers, but a large number of its citizens do not benefit from them.
Finally, the U.S. government takes more of a laissez-faire approach toward promoting income equality than the Canadian and European governments, which redistribute wealth much more proactively. The result is a much smaller gap between rich and poor in countries such as Canada, which translates to a more robust and prosperous middle class.