Tuesday, September 20, 2011

U.S. census highlights financial toll recession has claimed

The American dream has given way to a rude awakening.

The financial crisis and recession have eroded the wealth and hopes of the U.S. middle class and swelled the ranks of the impoverished, leaving a legacy of declining income and high unemployment.

Data released Tuesday by the U.S. Census Bureau, the first to capture the post-recession year of 2010, show a middle class laid low by the slump. Median income, adjusted for inflation, fell last year to $49,445 (U.S.). That marks a drop of 2.3 per cent from 2009 and more than 7 per cent from the 1999 peak of $53,252.

The report also showed one in six Americans living below the poverty line, or a record 46.2 million people, and a growing number of “doubled up” households, where those with the bleakest of outlooks have to band together to make ends meet.

The statistics paint a picture of post-recession United States facing a deep climb back from the persistently high unemployment and underemployment that have been hallmarks of the slow and halting recovery. With projections for economic growth slowing, companies are sitting on cash instead of hiring, and the unemployment rate remains at more than 9 per cent. That means many Americans will struggle to regain the ground they’ve lost, and without wage growth, they will have less to spend at a time when spending would provide a badly-needed boost to the economy. more