The great job shift © MSN Money (The great job shift © MSN Money)

The recovery is now officially in its fifth year. Sure, the stock market is back. And housing is getting off the floor. But for middle class Americans, the pressure is still on.

This has been an uneven recovery, with the benefits accumulating to the rich and the corporate sector while regular folks have largely been left behind amid stagnant wages, rising living costs, mediocre job gains and persistent long-term unemployment.

And none of this is new. The recession merely exacerbated trends that started in the late 1970s: lost manufacturing prowess, an important source of good-paying jobs; a shift to generally lower-paid service jobs; freer global trade, which deepens these employment problems; and increased reliance on finance, credit and debt as families try to hold on to the American dream.

The graphics that follow illustrate the depth of the problem -- and explain why so many in the middle class feel still feel so frustrated.

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Working harder for less

While Americans are working harder and are far more productive then they used to be, for a variety of reasons they are not sharing in the prosperity their work creates. This is a reversal of the situation enjoyed from the 1950s through the 1970s, when the middle class prospered amid strong demand for labor, widespread unionization and the ability to demand pay raises.

You can see this in the way median household income has badly lagged behind the per-capita share of economic output, as shown in the graphic above. Both measures are adjusted for inflation. While the available income statistics run only through 2009, it's doubtful that they've improved much since.

In the late 1970s, these measures were roughly equal. Now, actual household income is merely 73% of what it would be if the relationship had held. The difference has accumulated to corporate profits, as you'll see later.

One reason is that simple full-time jobs, the basic building blocks of a middle class life, are harder to find.

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So much for full-time work

One main problem is that since the recession ended, the economy has been creating low-quality, part-time, no-benefit positions. You can see this in the way the percentage of Americans with a full-time job has fallen back to early 1980s levels. This, in turn, is pressuring take-home pay.

There are a few additional considerations. Americans are increasingly fighting for scarce jobs, given that millions of women have entered the workforce and swelled the available pool of labor in the past 30-plus years. The female labor participation rate is up from the high 40% range in the late 1970s to nearly 60% now, though the male participation rate is down from 80% to just 71% now. As a result, the number of people working part-time because they can't find full-time work is at 8.1 million -- up from a low of 3 million in 2000.

And the jobs that are out there aren't paying as well as the positions lost during the recession used to. The number of goods-producing jobs has decreased, while most new jobs have been in service-oriented fields that often come with lower pay. For example, construction is down about 25% from its pre-recession employment level, while bar and restaurant jobs are up nearly 10%.

Now let's look at another building block of the middle class: homeownership.

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Crunched by the housing crunch

While home prices are recovering and are back to early 2004 levels -- up nearly 14% nationally from their lows, but still down around 27% from their 2006 highs -- many Americans aren't participating in the rebound. Foreclosures, short sales, negative home equity and other maladies have prevented many from tapping into this wealth recovery.

Consider the chart above.

It shows that even as home prices stabilized from 2009 to 2011 before pushing higher, the homeownership rate collapsed as one-time owners became newfound renters. As a result, millions missed the bounce; those who lost homes as well as wealth in the housing collapse won't benefit from the rebound.

Now, they are suffering another negative consequence as rental rates push higher and new cash-investor landlords enjoy the rise in home values. Right now, rent inflation is running at nearly 3% -- up from 1% in early 2011 and more than double the overall inflation rate.

So much for the wealth effect from homeownership. But at least the stock market is up, right?

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The stock market is back, but for whom?

It's true that household wealth has rebounded strongly in the past few years and is pushing to record highs. According to Federal Reserve data, the net worth of households and nonprofits has increased by more than $18 trillion from their lows in early 2009.

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But most of this gain has been in the stock market. And as with housing, most of the wealth has accumulated to the richest Americans.

Before the recession, the top 1% owned nearly 35% of all wealth in the United States. The top 20% owned 85%. The middle 20% owned just 4%.

It's gotten worse. The chart above compares the drop in Gallup's measure of stock market participation with the rise in the Standard & Poor's 500 Index ($INX). What this means is that since the S&P 500 suffered its harrowing drop to 666 in March 2009, the average household has been steadily pulling money out of investments. Those households lost on the way down yet they haven't benefited from the market's rebound.

This is fairly typical of what happens in market downturns, and it's too easy to say the middle class just made a bad call. Families struggling with lost jobs and lower wages in the recession often had no choice but to tap investments to get by.

So even though corporate profits are riding high in this post-recession era, the middle class isn't seeing the gains.

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Profits are high, but workers don't see gains

Returning to income, I mentioned how corporate profitability was getting a boost from the increasing desperation of American workers. The chart above shows how this has played out, with average middle class income as a percentage of per-capita gross domestic product sliding steadily lower while corporate profits, as a share of overall GDP, have marched higher.

In other words, middle class families have realized a smaller and smaller slice of the country's economic prosperity each year, with wages stagnating even while corporate profitability as a share of the economy has more than doubled.

This is why stories of corporate excess and CEO malfeasance sting so much -- and why they fueled the Occupy Wall Street crowd a few years ago.

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A few winners as middle class loses

 Putting it all together, the story of the middle class falling behind isn't complete without talking about the widening gap between the rich and everyone else. It's not as if we've all suffered. Those best able to profit from the big trends of the last 30-plus years -- the information technology revolution, financial innovation, globalization, the rise of the "knowledge" economy -- have done very well.

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You can see above how the pretax income for the top 1% nearly quadrupled heading into the recession from early 1980s levels, even as middle incomes stalled. The data go only through 2009, but no doubt, this measure has since rebounded back toward 2007 levels.

As for the poor, or those losing their grasp on the middle class lifestyle, desperation is leading more and more into welfare programs such as food stamps, where enrollment has exploded even as benefit payments fall.

To turn this around, we'll need to see a rebalancing away from corporate profits back toward labor income. The good news is that with labor shortages being reported in key industries and labor costs on the rise, we're at least on the right path. But after decades of falling behind, middle income Americans face a long road back.

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