Could you come up with $2,000 in 30 days if you had to? As many as 40 percent of American families can’t, despite the improving economy. Among them is Neal Gabler, who is frequently broke despite his successful career as a writer. As part of a collaboration between The Atlantic and the PBS NewsHour, Judy Woodruff looks at why Gabler and so many other Americans are struggling with savings.
And the future does not look encouraging:
In U.S. economic history, no economic expansion has lasted more than a decade.When the economy stops expanding, which it has been doing but barely over the last eight years ...
The current economic expansion is the fourth-longest on record. This record stretches all the way back to the 1850s.
The three longer booms all occurred since John Glenn orbited the Earth. The third-longest expansion started in 1982 and lasted close to eight years. The second-longest began in 1961 and lasted a bit less than nine years. The longest expansion we’ve experienced started in 1991 and lasted a decade, until the dot-com bubble burst in 2001.
This means that the current period of growth is entering the economic history books as something special. In just a few months it will overtake the 1982 boom and become the third-longest U.S. expansion on record.
... the retraction will be very, very painful. Americans basically have no reserves to fall back on, either individually or collectively.
Update: Well, it's already painful. Average hourly wages have risen by 2.9 percent in the last year, but average number of hours worked has fallen. But wait, there's more:
The ratio of employment to population was 59.7% last month, little changed from 59.6% a year earlier. But these figures were well below the 62.7% of the population that was employed in December 2007 when the Great Recession officially began. In a strong economic recovery, the employment-to-population ratio would be expected to rise sharply as a larger share of the population decides to enter the work force. A comparison of the labor-force participation rates also shows a relatively weak employment recovery. This ratio was roughly unchanged year-over-year, but the 62.7% participation rate in December was way below the 66.0% in December 2007.Get that? The labor participation rate today, after eight years of "recovery" boasted by the Obama administration, is much lower than it was when he took office. Some recovery.
Some analysts suggest that this fall in the employment-to-population ratio and the labor-force participation rate are to be expected given that the US population is aging and may be voluntarily exiting the labor force. According to them, the decline in the figure is due to demography and does not reflect a weak labor-market recovery. To respond to this, look at the participation rate for the 25- to 54-year-olds — the prime working group. These figures, which also come from the US Bureau of Labor Statistics, show that 81.4% of those in this age group were in the labor force in December, down from 83.2% in December 2007.
Update: Well, this is a downer: "Society Could Collapse In A Decade, Predicts Math Historian"
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