Half The Country Makes Less Than $27,520 A Year And 15 Other Signs The Middle Class Is Dying

19 comments

Posted on 6th June 2014 by Administrator in Economy |Politics |Social Issues

,

Depressed - Photo by Sander van der WelIf you make more than $27,520 a year at your job, you are doing better than half the country is.  But you don’t have to take my word for it, you can check out the latest wage statistics from the Social Security administration right here.  But of course $27,520 a year will not allow you to live “the American Dream” in this day and age.  After taxes, that breaks down to a good bit less than $2,000 a month.  You can’t realistically pay a mortgage, make a car payment, afford health insurance and provide food, clothing and everything else your family needs for that much money.  That is one of the reasons why both parents are working in most families today.  In fact, sometimes both parents are working multiple jobs in a desperate attempt to make ends meet.  Over the years, the cost of living has risen steadily but our paychecks have not.  This has resulted in a steady erosion of the middle class.  Once upon a time, most American families could afford a nice home, a couple of cars and a nice vacation every year.  When I was growing up, it seemed like almost everyone was middle class.  But now “the American Dream” is out of reach for more Americans than ever, and the middle class is dying right in front of our eyes.

One of the things that was great about America in the post-World War II era was that we developed a large, thriving middle class.  Until recent times, it always seemed like there were plenty of good jobs for people that were willing to be responsible and work hard.  That was one of the big reasons why people wanted to come here from all over the world.  They wanted to have a chance to live “the American Dream” too.

But now the American Dream is becoming a mirage for most people.  No matter how hard they try, they just can’t seem to achieve it.

And here are some hard numbers to back that assertion up.  The following are 15 more signs that the middle class is dying…

#1 According to a brand new CNN poll, 59 percent of Americans believe that it has become impossible for most people to achieve the American Dream…

The American Dream is impossible to achieve in this country.

So say nearly 6 in 10 people who responded to CNNMoney’s American Dream Poll, conducted by ORC International. They feel the dream — however they define it — is out of reach.

Young adults, age 18 to 34, are most likely to feel the dream is unattainable, with 63% saying it’s impossible. This age group has suffered in the wake of the Great Recession, finding it hard to get good jobs.

#2 More Americans than ever believe that homeownership is not a key to long-term wealth and prosperity…

The great American Dream is dying. Even though many Americans still desire to own a home, they are losing faith in homeownership as a key to prosperity.

Nearly two-thirds of Americans, or 64%, believe they are less likely to build wealth by buying a home today than they were 20 or 30 years ago, according to a survey sponsored by non-profit MacArthur Foundation. And nearly 43% said buying a home is no longer a good long-term investment.

#3 Overall, the rate of homeownership in the United States has fallen for eight years in a row, and it has now dropped to the lowest level in 19 years.

#4 52 percent of Americans cannot even afford the house that they are living in right now…

“Over half of Americans (52%) have had to make at least one major sacrifice in order to cover their rent or mortgage over the last three years, according to the “How Housing Matters Survey,” which was commissioned by the nonprofit John D. and Catherine T. MacArthur Foundation and carried out by Hart Research Associates. These sacrifices include getting a second job, deferring saving for retirement, cutting back on health care, running up credit card debt, or even moving to a less safe neighborhood or one with worse schools.”

#5 According to the U.S. Census Bureau, only 36 percent of Americans under the age of 35 own a home.  That is the lowest level that has ever been measured.

#6 Right now, approximately one out of every six men in the United States that are in their prime working years (25 to 54) do not have a job.

#7 The labor force participation rate for Americans from the age of 25 to the age of 29 has fallen to an all-time record low.

#8 The number of working age Americans that are not employed has increased by 27 million since the year 2000.

#9 According to the government’s own numbers, about 20 percent of the families in the entire country do not have a single member that is employed at this point.

#10 This may sound crazy, but 25 percent of all American adults do not even have a single penny saved up for retirement.

#11 As I noted in one recent article, total consumer credit in the United States has increased by 22 percent over the past three years, and 56 percent of all Americans have “subprime credit” at this point.

#12 Major retailers are shutting down stores at the fastest pace that we have seen since the collapse of Lehman Brothers.

#13 It is hard to believe, but more than one out of every five children in the United States is living in poverty in 2014.

#14 According to one recent report, there are 49 million Americans that are dealing with food insecurity right now.

#15 Overall, the U.S. poverty rate is up more than 30 percent since 1966.  It looks like LBJ’s war on poverty didn’t work out too well after all.

Sadly, it does not appear that there is much hope on the horizon for the middle class.  More good jobs are being shipped out of the country and are being lost to technology every single day, and our politicians seem convinced that “business as usual” is the right course of action for our nation.

Unless something dramatic happens, it is going to become increasingly difficult to eke out a middle class existence as a “worker bee” in American society.  The truth is that most big companies these days do not have any loyalty to their workers and really do not care what ends up happening to them.

To thrive in this kind of environment, new and different thinking is required.  The paradigm of “go to college, get a job, stay loyal and retire after 30 years” has been shattered.  The business world is more unstable now than it has been during any point in the post-World War II era, and we are all going to have to adjust.

19 Comments
  1. Iska Waran says:

    Half of the country has an IQ under 100.

    6th June 2014 at 8:51 am

  2. Pirate Jo says:

    Michael Snyder has broken some kind of record for the number of times he starts a sentence with the word “Sadly.”

    He should invent a new word, such as “Piss-off-ingly.”

    6th June 2014 at 9:25 am

  3. harry p. says:

    iska,
    i think that is an optimistic guess.

    6th June 2014 at 9:48 am

  4. Maddie's Mom says:

    A home should never have become a way to build wealth.

    6th June 2014 at 10:05 am

  5. Welshman says:

    That is depressing. My tenants need a combine income of 52,000 to 59,000 per year to pay rents of 1100 to 1400 per month rent.. All the rents are 50. to 75. per month lower than the average and you can’t give out big rent increase because they can’t afford it. I think it is better to be a renter, as homes are huge money black holes.

    I really feel that California is heading more to rentals than homeowners, as it is too expensive to buy a home and maintain it.

    6th June 2014 at 10:23 am

  6. AWD says:

    Don’t buy a home, for crissakes. Property taxes are going to the moon.

    Again, I have to say, the answer to all our problems is get on welfare.

    They get $57,400 a year in cash and benefits combined, tax free. You’d have to have a job making $69,000 a year pre-tax to equal what a welfare deadbeat gets. This article clearly states that is not happening, as does every jobs report. The best career option, clearly, is to get and stay on welfare, or better yet, the holy grail of entitlement programs, disability. Disability deadbeats are all driving new cars, taking vacations, and living the good life (but don’t have to work a day in their lives). If you can drive a new car or be able to take a vacation, you should be able to work a fucking job.

    6th June 2014 at 10:56 am

  7. Pirate Jo says:

    Owning a home is only a way to build wealth if you buy something you can pay off in less than ten years, then live for decades with no rent or mortgage payment. That’s assuming you live in a place where property taxes aren’t sky high.

    6th June 2014 at 11:27 am

  8. Eddie says:

    All Americans are dealing with food insecurity. They just don’t necessarily know it yet.

    At this point, self building a minimal house in a rural area, paying as you go, and going off-grid, is a much better thing to do than chaining yourself to a thirty year mortgage on a house that might lose half its value in a deflationary bubble popping event.

    Lamar knows how. Listen to Lamar, young people.

    http://www.youtube.com/user/solarcabin

    6th June 2014 at 12:02 pm

  9. bb says:

    Well Gold and silver are still at decent prices. Silver is less 19 dollars at spot price.

    6th June 2014 at 4:05 pm

  10. NIck A says:

    The “Post Thatcherite” commoditization of housing has been a really bad experience for the majority. Remember, one of the “causes” of the 2008 disruption was the provision of very suspect loans to aspiring “Home Owners”, often with very uninspiring credit history.

    Meanwhile, here in “Dumfuckistan of the South”, those flogging quickly (and very poorly) built apartments are still going strong, and the lemmings are all certain “Property Prices are Going to the Moon!” Even playing the Share Market has taken a back seat in the Country infamous for its betting and gambling obsession.

    All (as in, every one) of my colleagues “owns” one or more “IP”s, and it’s hardly a surprise to see that the “Property Shows” all top the ratings for Aussie TV. Think this will end well? Think again!!

    6th June 2014 at 6:05 pm

  11. Joseph E Fasciani says:

    Eddie is quite correct, IMO. At 71, I’ve lived nearly a third of my life in the bush, very nearly self-sufficient in food and able to get by on C$ 5,000/yr, when I started out at 27 to have a family. This was because my first parcel of land [40 hillside acres, not optimal for farming, but OK for our seven years there w/o hydro!] were PAID FOR, @ C$ 3,500.00 in 1970.

    Here in Kanada our feral gubbermint was recently forced to release a ten years’ study of 19-35 yr olds and their future. 25% do not believe they’ll have any career, only part-time and temporary jobs, essentially no coherent future. They’ve basically stopped looking for full-time employment. Many now live w/their parents.

    25% feel they’ll have full-time work, but only if they change careers at some time, including relocating to another province, very disruptive of family life here, as lifestyles vary greatly by region.

    Only 50% believe they’ll have a future in the career of their choice. These are historic LOW figures.

    As in the USSA [not a typo] our 10% are now at their all-time highest piggy portion at the trough, our middle class is falling [not quite as fast as the USSA], and the bottom is getting crowed w/people such as myself.

    To wit: at 71, I STILL work in my contracting business, as I don’t have enough savings or income to survive; my OAS & SocSec COMBINED are less than C$ 1,000.00, and I need at least $3,500.00 to get by, as my slumlord takes $1,500.00 for the small house I rent, and the CBC reckons it takes $8,000/yr just to operate a vehicle legally here in BC. Do the math.

    My greatest concern is I won’t have the strength to make it to 75. I’m ONLY getting by now because I have two housemates and, thanks to a work-site accident [snark], I get $1800/month from WCB for my wage loss, but that is short-term and won’t last after my next operation. But HEY, I’m NOT complaining, as I can still get up and perform enough to at least run my business w/good people.

    Remember: it’s not our age, but the mileage. Believe me when I confess I’ve racked enough for three lifetimes, so as I said above: no complaints. God help you all, and pass the ammunition.

    6th June 2014 at 9:45 pm

  12. Iska Waran says:

    Joseph, Do they have meat raffles in Canada? Here in South Manitoba (Minnesota) they seem to be the main economic activity in the northern half of the state. You could get into the meat raffle racket.

    6th June 2014 at 10:41 pm

  13. Joseph E Fasciani says:

    Yo, Iska!

    We do have meat raffles, but only in pubs, which is of course a good reason to let your wife know you’re going grocery shopping….

    I have a friend, Jim Carter, originally bred & born in Manitoba, who played semi-pro hockey for 15 years in Minnie’s Soda, now lives here in Langford, BC.

    6th June 2014 at 11:10 pm

  14. a cruel accountant says:

    Mr. Money Mousestache lives on less than that.

    Early Retirement extreme lives on less than 8k a year.

    90% of the people in china live on less than that.

    Amerika suck it up!

    7th June 2014 at 10:42 am

  15. Chicago999444 says:

    Owning a home is the only way to beat rent inflation and HALFWAY control rising costs. I say “halfway” because you still have rising property taxes, utilities, and maintenance to deal with, especially if you live in a condo, where it is essential to make sure you get on repairs immediately out of consideration for your downstream co-owners.

    I can easily live on $1,400 a month, saving the remainder of my take-home pay for retirement and entrepreneurial ventures. Taxes are $1400 a year, slightly more than $100 a month. Condo insurance- $800 a year. HOA, which includes heat for my 1200 sq ft place, building maintenance and repairs, common insurance, refuse collection – $450 a month. Electricity- $22 a month average, which covers most of my cooking, my washer, dryer, dishwasher, and everything else I use electricity to power.–I don’t have to deprive myself, just not be wasteful. Wireless internet/phone bundle from Cricket, $78 inclusive of taxes. Food and groceries, about $120, Entertainment, including an occasional meal out, about $35. I borrow films from the library and there are many things to do in this city that are free. I don’t eat badly, eat a lot of fish, dairy, and veggies- almost no red meat. Clothes, about $350 a year, for nice clothes- I don’t buy many, wear them for years, and religiously shop consignment and sales. Transportation, about $112, for a $100 unlimited transit pass and $12 for a grocery delivery for items too heavy to carry home, which I need only every 2 or 3 months. Gifts for birthdays and Christmas for small family, about $200 a year. Medical, $222 a month for catastrophic with high deductible.

    7th June 2014 at 11:16 am

  16. Chicago999444 says:

    Oh, yeah, $100 a month for personal home repair reserve.

    $1450 is doable, and $1700 is comfortable.

    Nice thing about being a single person who eats very little, and doesn’t need a car.

    7th June 2014 at 11:18 am

  17. Joseph E Fasciani says:

    My family left Chicago in 1958 to relocate in the fast-growing town of Bellevue, WA state. My mother –a classic immigrant care-giver to us four children and husband– cooked virtually every meal from scratch. I learned to cook & sew from her, and from my school home economics class, as it was called then.

    I simply cannot believe Chicago999444 that this is true: “Food and groceries, about $120, Entertainment, including an occasional meal out, about $35.”

    This is only US $155, and I cannot see how a person would live well on this amount. I’m used to cooking for four people here in my house-share, and I cannot get the food bills lower than C$200 EACH, never mind going out to eat.

    I buy mostly ‘on sale’ or in bulk [e.g., 3 liters of extra virgin olive oil for $18, lbs of unsalted butter were C$ 2.97 @ WalMart, crept up to 3.97 this year], etc. We eat well, nutritionally speaking, organic veg as much as possible, a variety of meats [some fish given to us by my daughter and a friend], and instead of going out, we make meals more festive w/pizzas, or some semi-prepared meats from M&M Meats, when on sale, for example.

    And yet two of my house-mates have to use a local food bank as well. The couple both only have part-time jobs, hers @ A&W for $13.50/hr, and his w/my company @ $15 to $17.50/hr, charged out at C$ 22.50 or $27.50/hr.

    Anyone else Out There able to “eat well” on less than $200/month?

    7th June 2014 at 2:12 pm

  18. Chicago999444 says:

    I take pride in keeping my food bill to the minimum.

    But it’s easy for a 62 year old woman. I eat very little, not even what the average female eats. I eat a carton of yogurt a day, get it on sale for $1 and go through a couple of gallons a milk a week. When I eat fish & veggies, the servings are tiny. I never buy red meat or chicken. I eat a lot of egg salad sandwiches and oatmeal. Milk costs $2.29 a gallon at Aldis, the cocoa- one of my few indulgences, cost more because I insist on a particular brand, hate the stuff from Aldi’s, about$4 for an 8 oz can. $1.49 for a dozen eggs, 3 dollars for a container of Aldi’s house brand instant oats that cost $3 and last me a couple of months. I always slip in a bag of trail mix or nuts each week for my emergency food supply. A bottle of chardonnay on sale every two weeks- I like it on weekends with my fish. I stockpile the canned pink salmon and boiled oysters from Aldi’s that you can do many things with. Buy fresh vegetables there if the price is good, and frozen ones on sale.

    7th June 2014 at 4:01 pm

  19. Welshman says:

    Chicago,

    Impressed, you do good girl. I think the no car in a large city is prudent, but I would not live in a big city.

    I have a female cousin in Hohenwald, TN, who moved there from Portland, OR because she could not live there due to the high cost. She ownes a home with a few acres, but she is a poor church mouse. I pay her internet fees and send she around 600. cash for birthdays and Xmas

    Your income is right at the so called povery level, and I am quite surprized you do that well in a big city.

    8th June 2014 at 1:03 pm

Leave a comment

You can add images to your comment by clicking here.