How Cash-Strapped are Americans?
The Great Recession technically ended in the summer of 2009, as gross domestic product rebounded from the bottom and started to expand. However, to any American not looking at the textbook definition, the recession never ended. The labor market is still weak and rising expenses are taking a toll on the ability of American’s to save for retirement.
Although the Dow Jones Industrial Average and the S&P 500 are nearing their all-time nominal highs made in 2007, the financial landscape is quite different. The headline unemployment rate is hanging near 8 percent, but even more concerning, the quality of jobs is deteriorating. According to the Census Bureau, a quarter of American jobs pay below the federal poverty line for a family of four. Many new jobs being “created” are part-time. In fact, the American Staffing Association finds that the temp industry added more jobs in the country than any other.
Adding insult to injury, 2013 is quickly becoming known as the year of rising costs. The fiscal cliff brought higher taxes to the majority of Americans earning a paycheck, while prices at the pump have never been higher for this time of the year. The national average price of regular gasoline topped $3.52 a gallon last week, compared to $3.30 a month ago. The widely tracked S&P GSCI, which is considered a leading measure of general price movement and inflation, also reached its highest level ever for the beginning of February.