Courtesy of Michael Panzner’s Financial Armageddon
So, let me see if I’ve got this straight:
Americans are being forced to settle for less when it comes to their working lives —
"U.S. Economy Trades High-Paying Jobs For Low-Paying Positions, Report Finds" (Huffington Post)
In the last 12 months, the U.S. economy has largely traded high-quality jobs for poorly-paid positions, according to a new report by the National Employment Law Project.
Though the economy has added more than a million jobs over the last year, new positions have skewed towards relatively low-wage industries, the New York-based non-profit finds in "A Year of Unbalanced Growth: Industries, Wages, and the First 12 Months of Job Growth After the Great Recession." The report finds a "striking imbalance" between the jobs being added and those lost over the last year:
• Lower-wage industries constituted 23 percent of job loss, but fully 49 percent of recent growth
• Mid-wage industries constituted 36 percent of job loss, and 37 percent of recent growth
• Higher-wage industries constituted 40 percent of job loss, but only 14 percent of recent growth
The industries which have shed the most positions, the report found, were correlated with the housing bust and the struggles of the financial sector. Construction made up 38 percent of job losses in the last year; non-durable manufacturing constituted 19 percent; finance and insurance made up 10 percent, the report found.
"This snapshot suggests that the job opportunities currently available to workers have deteriorated compared to what was available before the recession," said policy co-director at NELP Annette Bernhardt in a recent press release. "If these trends continue, the slow recovery combined with imbalanced growth could make it much harder for workers to find family-supporting jobs and pose real obstacles to restoring consumer demand. It’s imperative that we keep a close eye on industry growth trends as the recovery proceeds." —
they’re cutting back on unnecessary spending —
"In Recession’s Wake, Frugal Ways Make a Comeback" (New York Times)
Throw away the cellphone after two years? Not so fast. Ditch the flat-panel TV for an even thinner model? Maybe next year. Replace the blouse with the hole? Darn it!
Consumer spending has picked up, but for some Americans the recession has left something behind: a greater interest in making stuff last.
For a number of products — cars, phones, computers, even shampoo and toothpaste — the data shows a slowing of product life cycles and consumption. In many cases the difference is mere months, but economists and consumers say the approach just may outlast a full recovery and the return of easy credit, because of the strong impression the downturn made on consumers.
It is hardly the stuff of generations past, those stung by the Great Depression, who held onto antediluvian dishware and stored canned goods until rust formed on the lids. But for the moment, many citizens of a throwaway society are making fewer visits to the trash and recycling bins. —
and putting more money in the bank (or under the mattresses) —
"Americans Saving More and Paying Off Debt Faster Than Expected" (Fox News)
Americans are putting money into their savings accounts and paying down their debts faster than analysts expected.
Three years since the Great Recession started, consumer debt, which peaked at $12.5 trillion in 2008, dropped to $11.4 trillion in the fourth quarter of 2010. Despite historically low current mortgage rates, mortgage debt dropped nearly 10% and home equity lines of credit debt fell 6.5%, according to a recent quarterly report from the Federal Reserve of New York.
Why paying down debt is good for the economy
Although American’s newfound habit of opening savings accounts instead of shopping has slowed the growth of the economy in recent months, economists say it’s generally good news that Americans are getting their finances in order. A study by the Federal Reserve Bank of San Francisco showed that areas where people took on less debt relative to their income in the years leading up the recession endured the recession better than areas with higher debt amounts. —
and many are even being forced to cut back on essentials —
"Uninsured’s Numbers Surge During Recession" (Merced Sun-Star)
Laid-off professionals, middle-class families hit.
A health care crisis is sweeping the Central Valley, devastating middle-class and poor families and threatening to overwhelm the region’s fragile safety net.
The deep recession has pushed the ranks of the uninsured here to unprecedented levels. At the same time, a dire state budget deficit has forced lawmakers to drastically scale back or eliminate key health care programs for the state’s poorest residents.
At the nexus of these two trends lies a troubling new reality: Across class lines, people are struggling to access care — or simply are going without.
Doctors and nurses at county and nonprofit clinics say they’re seeing mounting numbers of out-of-work professionals and laid-off blue-collar workers joining the chronically poor and undocumented in waiting rooms throughout the region. —
and yet, they’re as upbeat as they’ve been for some time —
"U.S. Economy: Consumer Sentiment Climbs to Three-Year High" (Bloomberg)
Confidence among U.S. consumers increased in February to the highest level in three years as a drop in unemployment helped overcome concern over rising food and fuel costs.
The Thomson Reuters/University of Michigan final index of sentiment climbed to 77.5, exceeding the median forecast of economists surveyed by Bloomberg News, from 74.2 in January, a report today showed. The Commerce Department said the economy grew less than previously estimated in the fourth quarter as state and local governments cut back on spending.
The sentiment survey showed that for the first time in six years, households this month said they had heard more optimistic than pessimistic news on the economy, boosting the odds that consumer spending will keep bolstering the expansion. At the same time, a jump in fuel costs caused by the unrest in the Middle East threatens to keep the enthusiasm in check.
“We’ve clearly seen a bounce in the confidence numbers coincide with the gains in financial markets and the pickup in the economy, particularly the improving labor market,” said Jim O’Sullivan, global chief economist at MF Global Inc. in New York. “It was a bit of a surprise given the geopolitical tensions.”
Hmmm, what am I missing?
