Saturday, December 22, 2012

Two Americas?

The Washington Post is upbeat about the American economy:

Two new numbers out Friday morning indicate that the U.S. economy is plugging along better than you thought.

The most important legs of the economy—consumers and businesses—both showed surprising resilience in November, even as negotiations heated up over the fiscal cliff.Personal consumption spending rose 0.4 percent and incomes rose 0.6 percent, according to one report. According to another, overall orders for durable goods rose 0.7 percent while a key measure of business investment, orders for nondefense capital goods excluding aircraft, rose a surprising 2.7 percent.

It concludes:

Put it all together, and the Friday economic reports are a nice Christmas gift for anyone hoping to see a better year in 2013. The pieces are in place, with both the consumer and business sides of the economy holding up….

At the same time Bloomberg News offers a sobering assessment of the career prospects of Generation Y.

Generation Y professionals entering the workforce are finding careers that once were gateways to high pay and upwardly mobile lives turning into detours and dead ends. Average incomes for individuals ages 25 to 34 have fallen 8 percent, double the adult population’s total drop, since the recession began in December 2007. Their unemployment rate remains stuck one-half to 1 percentage point above the national figure.

Three and a half years after the worst recession since the Great Depression, the earnings and employment gap between those in the under-35 population and their parents and grandparents threatens to unravel the American dream of each generation doing better than the last. The nation’s younger workers have benefited least from an economic recovery that has been the most uneven in recent history.

Gen Yers who did not go to college do worse. Bloomberg reports:

Those who finish only high school or drop out fare worse. Almost four out of five jobs destroyed by the recession were held by workers with a high school diploma or less, according to Georgetown University’s Center on Education and the Workforce.
Middle-income jobs are disappearing for a wide range of young professionals. The number of financial counselors and loan officers ages 25 to 34 has dropped 40 percent since 2007, outpacing the 30 percent drop in total jobs for the profession, according to the federal Bureau of Labor Statistics.

Now the question is: which is the real America? Do statistics paint a fair picture of the economy? Or do the bleak accounts of the future prospects of American twentysomethings put us in touch with a higher truth?


n.n said...

It's difficult to know for certain when nearly 10% of our economy (at the federal level alone) is directed through a progressive devaluation of capital and labor. When we also consider private debt, the distortion of our economy is massive and embedded.

Well, as long as people continue to work and play, and self-moderate their behavior we should be all right. Unfortunately, more people are not working, they are playing, and they are failing to moderate their behavior. At this time, our odds of success are 50/50 or perhaps 49/51.

Sam L. said...

We be lied to.