Unemployment rates across the United States are as low as they have ever been in the last 16 years. While this figure is certainly cause for some excitement, some economic experts are not quite ready to celebrate yet. After all, simply having a job does not mean having the means to take care of oneself and enjoy a decent quality of life.
A recent CareerBuilder website survey seems to highlight the concerns of these economists who have warned that jobs do not directly translate to prosperity. According to the website’s survey, close to 80% of all Americans are living paycheck to paycheck and putting little to nothing into savings. Not only does this number raise some serious questions about the standard of living for the average American but it also creates sharp fears over the overall health of the American economy, which is typically dependent on consumer spending for roughly 66% of its activity.
Why Living on the Edge of Bankruptcy is Trending
If unemployment rates are so low, why is the number of Americans verging on the edge of bankruptcy or already in unrelenting debt growing by the month? Some believe that the root of the problem is twofold.
First, wages across most industries have become completely stagnant. Some entry-level positions have fought tooth-and-nail to gain some headway in terms of hourly wages, such as fast food workers who have gained big jumps in certain states, but generally the trend is not happening. Or, if employees in an industry do get wage increases, the hours they are scheduled drops to effectively negate that raise.
Secondly, costs are on the rise, as they always are. Common consumer goods steadily get more expensive as time goes on due to a number of factors, many uncontrollable, such as demand, supply chains, regulations, and so forth. However, top-end purchases have also been spiking and crippling the average American’s chances of affording them. Houses, educations, and automobiles are just a few examples of the big purchases that are becoming more and more unlikely.
As more evidence of higher cost purchases becoming unobtainable, the survey concluded that 10% of people or families that brought in $100,000 or more annually were still living paycheck to paycheck. It is assumed that making payments towards homeownership and paying for university educations for children are the leading causes of the financial despair for these upper-middle class groups.
Poor Wages Will Disrupt Retirement Plans & Government Spending
CareerBuilder also looked into how the waning financial stability of the average American will affect the country in the long term. In particular, about 33% of the survey participants noted that they could not afford to put anything towards retirement accounts and close to 20% mentioned they reduced their contributions in recent years. If people cannot retire on their own, it will mean the upcoming older generations of Americans are going to lean heavily on government programs for assistance. The more the government has to get involved, the more strain it puts on the budget overall.
The CareerBuilder survey included nearly 6,000 American workers, including more than 2,000 employees of human resource groups and hiring firms. Its findings may be indicative of a concerning, growing problem that will require more attention, effort, and possible legislation to solve.
If you would like to know more about this ongoing story, you can click here to read a full article posted by CBS News. If you are also struggling with your finances and believe legal assistance could help, please do not hesitate to contact Atlas Consumer Law and discuss your options. Our Chicago consumer attorneys frequently manage cases involving creditor harassment, foreclosure, bankruptcy, and more. With our legal guidance and representation, you may be able to find a way out of your financial troubles.