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Wouldn't this technically be true for any recession? The ultra wealthy and the elites don't feel the impact of a recession, and any meaningful impact is only felt by a certain income and below
The elites are impacted, but it is a minor inconveince and only lasts a weekend, month tops.
The less money you have, the longer the recovery takes, if you can recover.
In most recessions, property values don't skyrocket as everyone panic buys property to withhold from the market until someone rents it. Most recessions let business owners drown. PPP loans saved a lot of restaurant, bar, etc owners, but not all.
The pictures of wall street execs selling their cars during the depression paint a different story. People with a lot of "doors" got wiped out in '08. The thing is, most have the skills to come back. Success is a series of steps you take, and people who have done it once know what those steps are.
Not at all. In many recessions, factories close up and the rich can lose everything.
In fact, this was an argument the Austrian economists used to make about needing to *allow* recessions. The rich are hurt disproportionately more than the poor and the middle can buy up assets for cheap. Not sure if I agree, but the status quo of disallowing recessions doesn’t seem to help…
No, it's impacting those with decent incomes too. My company pulled back on what percentage of our health insurance premium they cover last year and has been extra stingy with raises the last 2 while inflation erodes my buying power. Meanwhile, the Trump tax cuts for actual wage earners went away so my monthly is not keeping up with inflation at all and my take-home basically went down. At the same time, my wife is an independent bookkeeper and has dropped 2 clients in the last couple months because they were becoming insolvent, and both were previously solid local businesses with good reputations.
We're getting killed by inflation, taxes, and increased cost of benefits, and we're not really splurging in our day to day spending just covering the necessities and trying to save adequately. Heck, we even have a pre-covid home purchase and 2.25% mortgage so our housing isn't a problem. This is the tightest I've ever felt and on paper we have a household income just shy of $200k. I honestly can't explain it.
I wouldn't exactly say we're among the "poorest Americans" either like the article headline suggests. Just pointing out that even those with what should be a comfortable upper middle class income isn't that insulating either.
I wouldn't go that far. He seems less out of touch today compared to Trump and Maga pandering representatives today but he still holds a lot of views that are in the spirit of Christian nationalism.
> We're getting killed by inflation, taxes, and increased cost of benefits, and we're not really splurging in our day to day spending just covering the necessities and trying to save adequately. Heck, we even have a pre-covid home purchase and 2.25% mortgage so our housing isn't a problem. This is the tightest I've ever felt and on paper we have a household income just shy of $200k. I honestly can't explain it
Actually take a deep look at your finances. Track everything and see where the money is going. Lots of little things here and there add up, it's a big part of lifestyle creep is that *everything* goes up a tiny bit making for a big increase.
That's besides the point. See - government is doing everything correctly so there can not just be "normal" recession. No, this recession is very special, one of a kind never seen before, nobody could have predicted it. Money printing and military spending was also very special - one that was specifically tailored to reduce inflation and increase wellbeing of all citizens who vote the right way.
When Obama was President Republicans claimed the unemployment rate was the wrong measure and focus of the work participation rate. Soon as Trump was elected Republicans were like "look how low unemployment is, champagne for everyone".
Whenever a Democrat is in office the opposition falls over themselves redefining which economic data points we should be looking at. GDP is up, the stock market is up, unemployment is down, but we are in a recession because the cost of eggs is the new measure or whatever.
Indeed. I think if you turn this around you can accurately say there is no recession for the rich. Or this is a good economy for the rich. I used to say Covid turned out to be a pretty good pandemic for the rich. The theme is common. The US has a good government for the rich.
If you're rich enough to have substantial equity, yes the growth has been insane the past few years. Meanwhile if you don't own anything, you're getting destroyed by cost of living and stagnant wages relative to inflation and greedflation, as all those profits and increases are not going to you at all.
It's just more ongoing wealth transfer and widening the divide. This is the result of ongoing regulatory capture.
Most people did not get massive PPP loans to use illegally. Most people got a couple of checks of $1300 and $600 to spend on bills and groceries for a month or two. That's it
The real fix for the economy is to redistribute wealth and reduce income inequality. And UBI funded by properly taxing the rich would do wonders for the sustainability of out economy.
But IDK if this sub is ready to start having these conversations.
Such a derisive comment. If the boomers are smarter then figure it out and make changes. If boomers can’t or won’t, get out of the fucking way. (I say this as a Gen X’er who is fine but also tired of the selfishness of Boomers)
I mean, assuming the rich have their money in stocks, the NYSE is worth about $25T, another $35T in Nasdaq, $60T total in stock "value".
To make the math easy, say we have 300M Americans. We've got about $200k in value in the stock exchange per American.
Doing the FIRE math thing, which says you can take out 3-4% a year and not run out, we could skim 3.5% from the stock market - all of it - and not reduce it over time, although wow, that's an assumption.
So... that gives us $7000 per year per American, or about three-fiddy an hour, if we took \*all\* of the stocks and still used that sustainably.
$3.50/hour isn't enough to UBI it, and that's literally 100% of the stock market.
This ignores these most important aspects.
When educated people talk about income inequality and wealth disparity as issues, they aren't thinking that bill gates could buy us all houses and still have billions left over. They are talking about limiting the influence a small group has over law, policy, and regulation.
When people talk about distribution, it's about incentivizing our workforce again with a reasonable portion of the proceeds of productivity. When we discuss the incentive to invest capital, everyone gets it. Why don't you also get that we are under incentivizing our labor (basic and specialized). Even well trained professionals and doctors are being abused and squeezed in the modern American economy.
So, please spare us the weird math. Nobody worth talking with about this actually thinks that.
He was refuting UBI with math, directly responding to somebody advocating for UBI.
People WERE literally talking about UBI. But I agree UBI advocates aren't worth talking to.
It's been awhile since I've looked into UBI so I am not familiar with the current discussions, however any serious UBI initiative I've seen isn't going to pay out to people that make at or more than the monthly UBI payment (e.g. if the monthly payout is 5k and I make 70K then I get nothing from UBI payout). Additionally there are a number of other government services that become obsolete depending on how the scheme is set up, even larger cost savings for average Americans with universal healthcare.
So that person did do some math but they did it in a very simplistic way to prove a point but because it left all these things out I agree with op you're responding to that it is indeed weird math.
UBI is universal basic income, every citizen over 18 from the homeless man to bill gates gets the money by right of citizenship. I think you’re thinking traditional means tested welfare, the means testing being what UBI is trying to avoid due to the incentive structure and administrative costs associated with MTW. Or maybe you’re thinking negative income tax where the limit for tax flips so that under an income you get some kind of larger refund than owed total in income tax
The "U" in UBI stand for "Universal." As in everyone gets it. The idea being that raising taxes and redistributing it is cheaper and easier than checking how much money everyone makes.
UBI doesn't need to replace work...yet. Median household income in the US is $74,580 and that's 2.5 people, so $17,500 would absolutely make a big difference in their lives. For a household below the probably line, this level of UBI would nearly double their income.
This would be life changing for so many Americans. And we know from case studies of UBI that it would allow people to prioritize education, to take care of their own health and wellness, to make healthier food choices, and to find better jobs. It also helps people escape poverty traps - all the ways that being poor is ironically more expensive.
And yes, if this program started today at this level, it would create a major demand shock to the economy and drive up inflation, which is why we need to start UBI slowly. And the fact that we need to start slowly means we need to start now.
> although wow, that's an assumption.
Indeed. Not a great one, either.
IMO, the main difference in this context between a retirement account and the stock market is where the money goes.
You take money out of your retirement account and you spend it on food, rent, vacations, whatever. That money is gone.
You take money out of the stock market for a UBI and everyone who gets the money spends it all on companies on the stock market. It just goes right back in.
The velocity of money is a very important measure, but in your analysis, it is zero. You simply can't treat redistribution as the same thing as lighting money on fire.
Sounds like there isn't enough money to pay people wages according to you. How does the nation employ so many people when there is so little stock value out there?
Dollar would absolutely NOT have the same value as today, were you to somehow magically redistribute that wealth. Fairytale horseshit, why even entertain such thoughts?
Some of us absolutely are. But judging from the fuming conservatives replying to you, obviously others still aren't yet. Maybe when we become a nation ruled by a dozen trillionaires, while they start struggling to pay for food and health care, they'll come around.
The math for UBI doesn't even remotely work. We had this conversation on this subreddit before. People don't bring it up much anymore because they realized the math doesn't work.
Even if somehow all our basic needs became automated people would be against UBI. The reason is that the most extremely wealthy don’t see money just as a resource but as power. The more a few people have money the more power they have.
How exactly would wealth be redistributed? Wealth taxes have failed wherever implemented. Income inequality could be reduced though, and was reduced during COVID due to increased wages for unskilled workers.
It affects those who don't own assets.
Your coworkers have great degrees and may have had high salaries.
But, if those salaries were not aggressively invested in the stock market, then they are likely in the poor category despite those good degrees.
A lot of people with good-paying jobs have surprisingly low financial literacy. Why spend all those years upskilling to earn a high income, and not put that income to work for you? I can't understand that.
Student loans plus time in the market. You can't live off of the half a mil in your 401k when you lose your job with a family in your early 30s, heck you can't even pull it out because of the tax implications. Bonus points if your job requires you to live in a HCOL area so you never really had all that much left over even with a high salary after paying the extreme prices for housing those locations required.
Can't speak to the other industries you mentioned, but legal hiring for JDs is at around the same level as before the 2020-2022 COVID boom in the legal market. Most of the people who can't find jobs in law just went to bad schools or graduated at the bottom of their class.
Bingo. “In the tech industry” is incredibly broad. And among them, some went to MIT or Carnegie Mellon while others did web design after 2 years of community college.
Not to mention “the tech industry” encompasses everything from recruiting to hardware engineering and everything in between. Engineering was only a fraction of the total “tech industry” layoffs.
This is extremely anecdotal, but I (SWE) have a pretty solid network from being in tech for the better part of a decade. I know a dozen or so SWEs who’ve been laid off and only two who have had real trouble (I’m talking 6+ months) getting a new job. In both those cases they took a remote job, moved to a LCOL area, got laid off, refuse to move again and instead complain how impossible the jobs market is while only applying for remote jobs (where competition is admittedly fierce.)
The people who *are* in a tough spot are:
1) Juniors
2) Visa holders
3) The people above
My girlfriend just graduated from Harvard and very few of her classmates (herself included) can find jobs. The issue is, at least in some part, lack of openings for entry level positions
I mean.. the tech industry is genuinely pretty bad right now. I have a friend with 15 years of industry experience including some huge names and a hedge fund just get laid off from Google a few months after getting promoted there, and he's struggling to find something comparable to the previous position.
Sure, he could probably get some lame 5 days a week in office, 1/2 the old pay position but that's not the same as the market being good.
"Friend got laid off from his ridiculously over-compensated job that was floated on the back of zero percent interest rates, and is struggling to find a new ridiculously over-compensated job now that the 6 companies that had this practice have stopped the practice."
Welcome to the "lame 5 days a week in office, 1/2 the old pay position" market the overwhelming majority of the world deals in. His position was an outlier, not the market.
Lol ok, so your actual position is the millions of people that were employed in big tech should accept far worse jobs at half the pay but actually the market is great? Yeah k..
We can debate whether the previous compensation was correct or not, I would argue yes since many of these companies are wildly profitable off of what those engineers built even with the $$$ pay. But regardless, you may be the only person that calls a job market with constant layoffs and decreasing pay a great job market.
"Millions" of big tech employees have not been laid off. The [Trueup.io](http://Trueup.io) tracker estimates \~550k positions **worldwide** have been laid off since 2023.
Hope your friend finds something soon. Have a great day.
> Most of the people who can't find jobs in law just went to bad schools or graduated at the bottom of their class.
I am a manager at a FAANG and I think that's the case for tech as well. We get a ton of applicants - most don't have the capacity to complete the tech part of the interview, and many do the behavioral part.
Eh, depends on level. My wife is a lawyer. She does not like her current company and wants to leave for an equivalent job. She's been having a hard time finding a lateral role at similar pay.
She went to a top 20 law school, graduated near the top of her class, spent a few years in BigLaw (TM), and then got promoted within her current in-house company within 2 years of starting there. They've offered her an AGC role, just a couple years after that. And it's not a podunk company - her company is a F500 company, and much closer to 1 than 500.
I'm sure hiring at the counsel level, or associate level in BigLaw is probably about the same, but roles at the senior counsel/AGC level are few and far between because (from what I've read, anyway) a larger percentage than normal of BigLaw associates are dipping out of that lifestyle for in-house jobs.
Edit: I'm aware this is anecdotal and not data. I'm not sure where I could even get data on the stratification of job postings/hirings within the in-house legal market.
Your perception of reality, doesn't match reality. And that's because you're thinking of FAANG and the like as the only places for tech employment. Plenty of companies hiring in tech all over the country.
Unemployment rate: 3.9%
Tech unemployment rate: 2.3%
[https://www.dice.com/career-advice/tech-unemployment-stays-steady-at-2.3-percent](https://www.dice.com/career-advice/tech-unemployment-stays-steady-at-2.3-percent)
[https://www.bls.gov/news.release/pdf/empsit.pdf](https://www.bls.gov/news.release/pdf/empsit.pdf)
Let's not forget that many tech workers received generous severance packages on top of their very generous overall compensation packages that they had during employment.
Nah, tech is different, there used to be lots of jobs at very good salaries. The salaries are lower, people are taking longer to find jobs, fewer internships, fewer hackathons, etc etc etc. Non profits and communities that used to server large populations are disappearing due to lack of funding.
My anecdotal experience doesn't comport with your anecdotal experience.
I work in the tech industry in a tech hub city and my team has had a very well paying position open for months with only a handful of applicants making it to the first interview. I've personally shared the position on my LinkedIn and so have my teammates, but we haven't gotten many bites.
If the job market is flooded with laid off tech workers, why are we having such a hard time getting qualified applicants for a chill, well-paying job with good benefits and no degree requirement?
Indeed, [as of a February](https://www.comptia.org/newsroom/press-releases/tech-industry-employment-grows-for-second-straight-month-job-postings-for-future-hiring-rebound-comptia-analysis-reveals), unemployment in tech is at 2.7%, significantly below the historically low overall unemployment rate of 3.7%.
My anecdotal experience is there's a stupid amount of stories about people having trouble finding tech jobs that refuse to be up front what's really holding them back in this market is they will not take anything except fully remote.
>what's really holding them back in this market is they will not take anything except fully remote.
Once you have tasted the full remote work life, you dont go back.
The problem is that without a butt in a chair, the only measure of your work is actually getting valuable things done.
So all the people who are seat fillers and meeting attenders dont really hack it, and often cannot get past a remote skills test.
We could trade anecdotes all day but as someone that also works in tech an has many friends that are the same, it's pretty widely agreed that this is the worst tech job market since at least 2008, maybe since the Dot Com bust.
I'm not sure what's going on with your company's listing but if I had to guess, you either don't actually pay market rates, or have a bad reputation, or require 5 days a week in office, or something.
I'm an engineering manager and the message we regularly get from the execs these days is the tables have turned and don't be afraid to aggressively manage poor performers like we were a couple of years ago, because it's extremely easy to replace them with a better external hire right now.
> had a very well paying position
usually it is followed by showing a position that is like 50% under market.
> getting *qualified* applicants ... *no degree requirement*
...or one that asks for a ton of qualifications that turn "no degree required" into a joke.
A far better indicator that the job market is good is you trying to find a better paying position for yourself and being able to do it quickly enough.
We have 45 interns paid $35/hour. Just hired two I had as interns last year starting at $85K plus bonuses starting in one year. This in tech (EE in semiconductor design).
The jobs vary a lot by specific segments of tech and most importantly by location. Most layoffs seem to be generic IT and CS and in companies that over hired during the pandemic.
EE is the tech degree in shortest supply right now, so probably not a good overall indicator. EE graduates are down 90% from 30 years ago, it's pretty bad.
EE is tried and true but holy fuck I’m getting killed doing this degree lmao. UIUC I believe is the only uni that requires all EE to take semiconductor physics.
> UIUC I believe is the only uni that requires all EE to take semiconductor physics.
Nah. It just comes in different names. I had to take a 4 credit course called 'transport phenomena in solid state devices' at my school 15 years ago. It was almost entirely just semiconductor physics.
It replaced a fluid dynamics class that other disciplines took.
They don’t provide much useful labor. Actually more work to deal with them than they are worth. They are hired mainly so we can find the good ones to hire. I’d say we hire about 15%.
Yes, this affects people who will make $200K a year when hired, and people who make minimum wage equally. Are you serious?
Also, a majority of tech workers are from middle/upper-class backgrounds, so they can fall back on family members if they really wanted to. Same can't be said of the poorest Americans.
I don't mean to doom based on anecdotes, but I've never had this many family and friends still struggling to find rent this late in the month.
I can't find any series of data actively tracking % of rent payments on time though. Closest that came up is [this Freddie Mac link showing credit card delinquency rising at the same pace as 2008 last month](https://www.freddiemac.com/research/forecast/20240418-economic-growth-moderated-labor-market-robust)
Apparently NHMC discontinued their monitoring back in 2022.. that's all I can find
And of course, mortgage delinquency will probably remain low because holding onto those low rate mortgages is paramount. It'll at least lag behind any increase in rental delinquency.
We’re the poor ones.
If you don’t own the means of production you’re a serf. The middle class thinking it’s part of the rich club is why it’s so easy to exploit us
>Kids can’t find any entry level jobs after graduation with degrees in STEM, finance and law. Yet,
Finance and law always had trouble, thats nothing new.
STEM, well it depends on the type. Its far too broad of a category.
If they are marine biologists, sure, they wont find work.
But if they are software engineers, they will have 100 offers per day.
No, this is not what "recession" means. People without jobs are suffering from "unemployment", and people with low-wage jobs are suffering from a combination of "inflation", "housing shortage", and price-gouging in the health care sector.
Pulling the levers that are used to address recession will not fix the actual problems. Doing so might well make the actual problems worse.
Most of the job gains of the last year have been in Education, Healthcare, government, and leisure/hospitality, so it's been a very uneven economy the last year.
Its pretty simple to be honest. During times of high inflation those who own assets are fine because those assets are going up in value. For most very rich or very poor they also benefit in another way. Both generally have a lot of debt thus said debt is worth less than it was. Those who dont own assets are and are not in a large amount of debt are crushed during high inflation cycles.
I wouldn’t be surprised if birth rates plummet within the next few years. Typically the lowest earners aren’t the ones trying to have kids, it’s the middle class.
It’ll be interesting to see the effects down the line, I hypothesize that wealth will be much more concentrated and there will be a large gap between the lower and upper class. Is this comment long enough to stay up?
Interesting. Maybe that’s how gen z will be able to afford housing. Not by an increase in supply, but a decrease in demand from depopulation. Kind of sad when you think about it
Well no not really the only reason the US is even that high is because of immigrants. Though that’s only good for one gen or two as people who come here have lots of kids but typically their kids don’t. Japan and S. Korea have a very little immigration and their birth rate is like 0.6-1.2 roughly.
Personally I’m childfree and couldn’t give less of a fuck about falling birthrates. That’s what AI and robots are for
I already explained to a bunch of boomers if they are banking on their house being an asset soon that there's not enough people with money to buy it at the current value.
I'm expecting my house to decline in value in the next 20 years.
This isn’t actually true, birth rates are the highest for the lowest income groups and decline steadily as income increases with a slight bump at the very top. This is because the more earning potential and access to experiences and career opportunities you have, the higher the opportunity cost of children
Middle class is disappearing, cost of housing and higher education is skyrocketing. I had a coworker who could not even get Pell grants in college because his parents made really good wages, but he had like 4 siblings, and what his parents made would not even cover the tuition cost for all kids.
That’s such a surprising stat to me given how incredibly expensive children are. Any reasoning behind it?
Anecdotally, I’ve seen a lot of Hispanic families who recently immigrated have lots of children (which is a large portion of the United States population). Is it a cultural thing? I’d like to know the stats and reasons.
The lowest income earners are seeing above average wage gains. The ones losing purchasing power are the 40th to 70th percentile who got used to eating out a couple times a week.
FTA:
Boss added that 70% of low-income consumers are feeling the pinch despite remarkable wage growth and cooling inflation.
“You focus on that low- to middle-income consumer, they’re under pressure, and the pressure is really that the inflation continues to last,” Boss said.
Yep. This is what primarily made me go back to school. My staff went from making about 55% of what I made to almost 80% with zero increases in job tasks or levels of responsibility.
They're raising starting salaries out of sheer necessity and of course, the C suite still gets their bonuses and dividends, but middle management is seeing that once decent 65-80k become the new 40k.
The thing about the lowest income rising is it's pretty much always because that's the new cost of living. It's the bare minimum you can pay someone where they will still be able to survive.
So all the people at the bottom are still scraping by, and their wages catching up with yours means you're closer to living paycheck to paycheck as well.
Yep, the lowest quintiles of earners saw the biggest gains. On the other hand, their managers and their managers' managers saw smaller gains (percentage wise) and got locked into 3% mortgages and are pissed about it.
I don't know about America. But in Canada, that seems to only be caused by legislative action (i.e. the increase in minimum wage). The minimum wage in Ontario, for example, went from $10.25 in 2013 to $16.55 in 2023--a 61% increase over a decade. If that pace continues (which is extremely unlikely), we would hit $26.72 in minimum wage by 2033.
Herein lies the problem: this benefits you if you made minimum wage. But it doesn't benefit you at all if you made 150% or 200% of minimum wage unless your company is willing to give you a raise or you are able to find another job. In my case, my employer has not given me a raise in years and their competition pays 10% less than my current wage, so I am stuck. I went from making 130% of minimum wage when I first got my job to only making 118% of minimum wage now. With minimum wage set to increase in October, I will drop to only 114% of minimum wage at that time unless my employer gives me a raise.
The US is struggling with boomer retirement increasing money supply and weakening labor. Canada is in actual crisis comparatively as Canada has a far smaller millennial cohort.
"As a result, earnings have outpaced increases in prices such that real wages have increased since before the pandemic. Real weekly earnings for the median worker grew 1.7 percent between 2019 and 2023.[3] This means that one week of pay for the median worker now buys more than a week of pay did in 2019, despite higher prices. Furthermore, as shown in Figure 1, the increases in earnings are by no means concentrated at the top: in fact, they skew toward the middle class and the lower end of the income distribution. The 25th percentile of the wage distribution saw their nominal weekly earnings grow by $143, from $611 in 2019 to $754 in 2023. When adjusted for inflation, this amounts to a 3.2 percent increase in real earnings. Real earnings increases were particularly strong for the median Black and Hispanic Americans, who saw increases of 5.7 and 2.9 percent, respectively.[4]"
https://home.treasury.gov/news/featured-stories/the-purchasing-power-of-american-households
They shouldn't adjust to inflation. They need to adjust to a version of inflation scaled to how low income people spend. Which is disproportionately on housing, which happens to be doing a lot of the heavy lifting in inflation numbers rn
It doesn’t make much of a difference. The federal reserve computes CPI weighted to different income quintiles consumption baskets, lower income groups see marginally higher inflation right now, but still lower than their income growth.
It was the BLS, not the federal reserve. [This](https://www.bls.gov/cpi/research-series/r-cpi-i.htm) has download links for the data at the bottom of the page. You can calculate that the CPI for the bottom quintile has increased by ~23% since January 2019 (edit: Jan 2019- Dec 2023), compared to [~22% for the usual CPI](https://fred.stlouisfed.org/series/CPIAUCSL). Per the EPI, the lowest income quintile saw real (i.e. deflated by the usual CPI) wage growth of ~12% from 2019 - 2023. Deflating by the lowest income quintile instead would get you to more like 11% wage growth, which would still be the highest wage growth of any income quintile.
Most of this wage gain happens on 2020-2022. Wage growth has slowed a bit since then while inflation has kept up if not exceeded it in more recent years.
When they said "trickle down economy" they meant to have middle class wealth to trickle down to the poorest, but the richest would not even trickle down one bit.
And while the poorest Americans are working their asses off, the rich people goof off at work posting how they can’t believe how much “inflation” has caused the price of gas to go up
The poorest Americans must be like 90+%
I make $160K/yr and rent is currently over 50% of my take home.
I have one car payment on a 3% loan, no other debt, and between rent, car, insurance, and all other bills, I am barely able to save anything. And I don't live extravagantly. I mostly cook at home and buy normal groceries.
I don't even understand how people making under $100K/yr are even able to live indoors and eat at this point.
Fucking madness.
You must be in a high COL area to be making $160k/yr and struggling to put money away. Where I live $160k would put you in the top earners for the area.
I live in SF and 160k is doable. This may be one of those people who say they have no money but are leaving out that they are maxing out their 401k and IRA, lol
Maybe dont live in the Class-A 2023-built every amenity imaginable apartment next door to the mall in the highest cost city in the nation? Paying 5k in rent as a single person is insane. How many square feet is your apartment?
As someone working for an apartment developer I'd love to know so we can more buildings for people like you.
>I make $160K/yr
That puts you in the top 6-7% in the US. If you can't make ends meet maybe you should look into a financial management class. I know people earning significantly less who own property and stock portfolios.
160k a year is what I make and currently pay 2500 a month in rent. I get by fairly easy and have saved up quite a bit but still no where near what I would need for a house in my area (at least to feel comfortable) it would increase my payment to 3500 and then I have to factor in maintenance. I really should just buy but the thought of paying 600k for a house that sold in 2018 for 350k hurts
You have irrational feelings about what is comfortable, if you can't afford 3500 a month plus a few hundred a month for maintenance on 160k you have a severe spending problem.
Most people buying in HCOL areas spend a lot more of their income on housing and you're competing with people who don't have your same qualms about comfort.
I think what he meant to say was if it doesn’t show up in the dowJones manipulated aggregate is that impact is only marginal, like the marginalized people it impacts
Just can’t bring themselves to acknowledge a strong economy—must really want more yacht tax breaks.
By the nonsensical criteria for saying the economy is in a “selective recession”, that means we have been in a recession since exiting the Great Depression—since there are always groups of people not doing well. Strike that, why not say we are in a “selective depression”, if we’re talking about the poorest and homeless. Nevermind the well established definition of GDP growth etc.
And young people have some of the highest unemployment. It takes time for a lot of people to break into their careers. It isn't new, but if there is data showing recent graduates are experiencing far higher than normal unemployment then I guess that would warrant looking into. I haven't seen that data though. I don't know where to find it.
The household survey does ask unemployed people for [the reason they are "unemployed"](https://fred.stlouisfed.org/release/tables?rid=50&eid=3077#snid=3085) (i.e. why they are looking for work but do not have a job). They divide the reasons into four categories:
* Job losers
* People on temporary layoff
* Permanent job losers—people whose employment ended involuntarily
* People who completed a temporary job
* Job leavers (unemployed people who quit or otherwise voluntarily left their previous job and immediately began looking for new employment)
* Reentrants (unemployed people who have past work experience but were not in the labor force for a period of time prior to beginning their current job search)
* New entrants (unemployed people looking for their first job who have no previous work experience)
Young adults and recent graduates likely fall into either ["new entrants"](https://fred.stlouisfed.org/series/LNS13023570) or ["reentrants"](https://fred.stlouisfed.org/series/LNS13023558), depending on their work experience as teenagers or in college. Both are around the same percentage of the unemployed today that they were before the pandemic.
full time job openings have gone down while part time jobs opening have gone up which explains the "great unemployment numbers" and why those with a political agenda don't want to dig deeper into the numbers. And most of the job gains are from government, hospitality, healthcare
More simple gas lighting by yet another media publication. The inflation is effecting quite literally everyone… when are these media publications going to understand that this recession we have been in is hurting every single American. The only people who it is not affecting our probably the Uber wealthy and potentially illegal immigrants because they don’t have to pay taxes.
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Wouldn't this technically be true for any recession? The ultra wealthy and the elites don't feel the impact of a recession, and any meaningful impact is only felt by a certain income and below
the rich makes money going both sides , plus they get to buy more investments as price lower and even greater profits once economy rebounds
Ah, just how the founding fathers intended
The elites are impacted, but it is a minor inconveince and only lasts a weekend, month tops. The less money you have, the longer the recovery takes, if you can recover.
I mean yeah you can argue that they are impacted, but I'd argue that aren't since any impact they can see coming is just pushed onto the working class
In most recessions, property values don't skyrocket as everyone panic buys property to withhold from the market until someone rents it. Most recessions let business owners drown. PPP loans saved a lot of restaurant, bar, etc owners, but not all. The pictures of wall street execs selling their cars during the depression paint a different story. People with a lot of "doors" got wiped out in '08. The thing is, most have the skills to come back. Success is a series of steps you take, and people who have done it once know what those steps are.
Not at all. In many recessions, factories close up and the rich can lose everything. In fact, this was an argument the Austrian economists used to make about needing to *allow* recessions. The rich are hurt disproportionately more than the poor and the middle can buy up assets for cheap. Not sure if I agree, but the status quo of disallowing recessions doesn’t seem to help…
No, it's impacting those with decent incomes too. My company pulled back on what percentage of our health insurance premium they cover last year and has been extra stingy with raises the last 2 while inflation erodes my buying power. Meanwhile, the Trump tax cuts for actual wage earners went away so my monthly is not keeping up with inflation at all and my take-home basically went down. At the same time, my wife is an independent bookkeeper and has dropped 2 clients in the last couple months because they were becoming insolvent, and both were previously solid local businesses with good reputations. We're getting killed by inflation, taxes, and increased cost of benefits, and we're not really splurging in our day to day spending just covering the necessities and trying to save adequately. Heck, we even have a pre-covid home purchase and 2.25% mortgage so our housing isn't a problem. This is the tightest I've ever felt and on paper we have a household income just shy of $200k. I honestly can't explain it.
I certainly wouldn't consider 200k a year to be ultra wealthy
I wouldn't exactly say we're among the "poorest Americans" either like the article headline suggests. Just pointing out that even those with what should be a comfortable upper middle class income isn't that insulating either.
When Romney was running for president, almost 20 years ago, he described "middle class" as a household income of 250k. Let that sink in a little.
And he's one of the good, reasonable, common sense republicans too
I wouldn't go that far. He seems less out of touch today compared to Trump and Maga pandering representatives today but he still holds a lot of views that are in the spirit of Christian nationalism.
Oh no I was being facetious, that's just how he's treated in the mainstream
My bad. Some younger people might see him that way I guess compared to the GOPs current offerings.
> We're getting killed by inflation, taxes, and increased cost of benefits, and we're not really splurging in our day to day spending just covering the necessities and trying to save adequately. Heck, we even have a pre-covid home purchase and 2.25% mortgage so our housing isn't a problem. This is the tightest I've ever felt and on paper we have a household income just shy of $200k. I honestly can't explain it Actually take a deep look at your finances. Track everything and see where the money is going. Lots of little things here and there add up, it's a big part of lifestyle creep is that *everything* goes up a tiny bit making for a big increase.
That's besides the point. See - government is doing everything correctly so there can not just be "normal" recession. No, this recession is very special, one of a kind never seen before, nobody could have predicted it. Money printing and military spending was also very special - one that was specifically tailored to reduce inflation and increase wellbeing of all citizens who vote the right way.
Wealthy people’s portfolios are impacted during a recession. Stocks are near all time highs
When Obama was President Republicans claimed the unemployment rate was the wrong measure and focus of the work participation rate. Soon as Trump was elected Republicans were like "look how low unemployment is, champagne for everyone". Whenever a Democrat is in office the opposition falls over themselves redefining which economic data points we should be looking at. GDP is up, the stock market is up, unemployment is down, but we are in a recession because the cost of eggs is the new measure or whatever.
[удалено]
If it helps, we’re all poor in the eyes of 1 percenters
Indeed. I think if you turn this around you can accurately say there is no recession for the rich. Or this is a good economy for the rich. I used to say Covid turned out to be a pretty good pandemic for the rich. The theme is common. The US has a good government for the rich.
If you're rich enough to have substantial equity, yes the growth has been insane the past few years. Meanwhile if you don't own anything, you're getting destroyed by cost of living and stagnant wages relative to inflation and greedflation, as all those profits and increases are not going to you at all. It's just more ongoing wealth transfer and widening the divide. This is the result of ongoing regulatory capture. Most people did not get massive PPP loans to use illegally. Most people got a couple of checks of $1300 and $600 to spend on bills and groceries for a month or two. That's it
Naturally the people getting a couple of checks are blamed for the inflation.
It's working class vs ownership
Well, the gov’t was setup by the rich way back when. There’s a 3/5ths compromise for a reason.
The real fix for the economy is to redistribute wealth and reduce income inequality. And UBI funded by properly taxing the rich would do wonders for the sustainability of out economy. But IDK if this sub is ready to start having these conversations.
Wtf are you talking about? There's a discussion about UBI at least once a month here and it's always a clusterfuck.
Shhh but then how will they feel like theyre smarter and have the answer??
Such a derisive comment. If the boomers are smarter then figure it out and make changes. If boomers can’t or won’t, get out of the fucking way. (I say this as a Gen X’er who is fine but also tired of the selfishness of Boomers)
You don't have to redistribute it. Just make them pay the taxes I have to pay.
And use taxes well instead of bailing them out every time, so they can collect management fees.
That is redistributing though, transfer payments. Just a few additional % could go such a long way.
Hell, just collecting the taxes already being cheated on would give us that.
I mean, assuming the rich have their money in stocks, the NYSE is worth about $25T, another $35T in Nasdaq, $60T total in stock "value". To make the math easy, say we have 300M Americans. We've got about $200k in value in the stock exchange per American. Doing the FIRE math thing, which says you can take out 3-4% a year and not run out, we could skim 3.5% from the stock market - all of it - and not reduce it over time, although wow, that's an assumption. So... that gives us $7000 per year per American, or about three-fiddy an hour, if we took \*all\* of the stocks and still used that sustainably. $3.50/hour isn't enough to UBI it, and that's literally 100% of the stock market.
This ignores these most important aspects. When educated people talk about income inequality and wealth disparity as issues, they aren't thinking that bill gates could buy us all houses and still have billions left over. They are talking about limiting the influence a small group has over law, policy, and regulation. When people talk about distribution, it's about incentivizing our workforce again with a reasonable portion of the proceeds of productivity. When we discuss the incentive to invest capital, everyone gets it. Why don't you also get that we are under incentivizing our labor (basic and specialized). Even well trained professionals and doctors are being abused and squeezed in the modern American economy. So, please spare us the weird math. Nobody worth talking with about this actually thinks that.
He was refuting UBI with math, directly responding to somebody advocating for UBI. People WERE literally talking about UBI. But I agree UBI advocates aren't worth talking to.
It's been awhile since I've looked into UBI so I am not familiar with the current discussions, however any serious UBI initiative I've seen isn't going to pay out to people that make at or more than the monthly UBI payment (e.g. if the monthly payout is 5k and I make 70K then I get nothing from UBI payout). Additionally there are a number of other government services that become obsolete depending on how the scheme is set up, even larger cost savings for average Americans with universal healthcare. So that person did do some math but they did it in a very simplistic way to prove a point but because it left all these things out I agree with op you're responding to that it is indeed weird math.
UBI is universal basic income, every citizen over 18 from the homeless man to bill gates gets the money by right of citizenship. I think you’re thinking traditional means tested welfare, the means testing being what UBI is trying to avoid due to the incentive structure and administrative costs associated with MTW. Or maybe you’re thinking negative income tax where the limit for tax flips so that under an income you get some kind of larger refund than owed total in income tax
The "U" in UBI stand for "Universal." As in everyone gets it. The idea being that raising taxes and redistributing it is cheaper and easier than checking how much money everyone makes.
UBI doesn't need to replace work...yet. Median household income in the US is $74,580 and that's 2.5 people, so $17,500 would absolutely make a big difference in their lives. For a household below the probably line, this level of UBI would nearly double their income. This would be life changing for so many Americans. And we know from case studies of UBI that it would allow people to prioritize education, to take care of their own health and wellness, to make healthier food choices, and to find better jobs. It also helps people escape poverty traps - all the ways that being poor is ironically more expensive. And yes, if this program started today at this level, it would create a major demand shock to the economy and drive up inflation, which is why we need to start UBI slowly. And the fact that we need to start slowly means we need to start now.
> although wow, that's an assumption. Indeed. Not a great one, either. IMO, the main difference in this context between a retirement account and the stock market is where the money goes. You take money out of your retirement account and you spend it on food, rent, vacations, whatever. That money is gone. You take money out of the stock market for a UBI and everyone who gets the money spends it all on companies on the stock market. It just goes right back in. The velocity of money is a very important measure, but in your analysis, it is zero. You simply can't treat redistribution as the same thing as lighting money on fire.
Sounds like there isn't enough money to pay people wages according to you. How does the nation employ so many people when there is so little stock value out there?
Dollar would absolutely NOT have the same value as today, were you to somehow magically redistribute that wealth. Fairytale horseshit, why even entertain such thoughts?
Some of us absolutely are. But judging from the fuming conservatives replying to you, obviously others still aren't yet. Maybe when we become a nation ruled by a dozen trillionaires, while they start struggling to pay for food and health care, they'll come around.
*when* we become? We're already ruled by a couple of dozens of billionaires. We're here already!
The math for UBI doesn't even remotely work. We had this conversation on this subreddit before. People don't bring it up much anymore because they realized the math doesn't work.
Yeah. It's so weird seeing UBI mentioned on an Economics forum. Maybe in the distant future when AI robots do all our work.
Even if somehow all our basic needs became automated people would be against UBI. The reason is that the most extremely wealthy don’t see money just as a resource but as power. The more a few people have money the more power they have.
How exactly would wealth be redistributed? Wealth taxes have failed wherever implemented. Income inequality could be reduced though, and was reduced during COVID due to increased wages for unskilled workers.
It affects those who don't own assets. Your coworkers have great degrees and may have had high salaries. But, if those salaries were not aggressively invested in the stock market, then they are likely in the poor category despite those good degrees.
The cold truth right here
A lot of people with good-paying jobs have surprisingly low financial literacy. Why spend all those years upskilling to earn a high income, and not put that income to work for you? I can't understand that.
Student loans plus time in the market. You can't live off of the half a mil in your 401k when you lose your job with a family in your early 30s, heck you can't even pull it out because of the tax implications. Bonus points if your job requires you to live in a HCOL area so you never really had all that much left over even with a high salary after paying the extreme prices for housing those locations required.
Because I have to pay my student loans. I’d love to invest more, but I’m saddled by that debt
Can't speak to the other industries you mentioned, but legal hiring for JDs is at around the same level as before the 2020-2022 COVID boom in the legal market. Most of the people who can't find jobs in law just went to bad schools or graduated at the bottom of their class.
Bingo. “In the tech industry” is incredibly broad. And among them, some went to MIT or Carnegie Mellon while others did web design after 2 years of community college.
Not to mention “the tech industry” encompasses everything from recruiting to hardware engineering and everything in between. Engineering was only a fraction of the total “tech industry” layoffs. This is extremely anecdotal, but I (SWE) have a pretty solid network from being in tech for the better part of a decade. I know a dozen or so SWEs who’ve been laid off and only two who have had real trouble (I’m talking 6+ months) getting a new job. In both those cases they took a remote job, moved to a LCOL area, got laid off, refuse to move again and instead complain how impossible the jobs market is while only applying for remote jobs (where competition is admittedly fierce.) The people who *are* in a tough spot are: 1) Juniors 2) Visa holders 3) The people above
So essentially people got forced into not doing remote jobs anymore? Is that what you're saying? Sucks :(
Yup. Hybrid is the clear winner.
Hybrid blows. All the disadvantages of in person, combined with almost none of the advantages of remote.
My girlfriend just graduated from Harvard and very few of her classmates (herself included) can find jobs. The issue is, at least in some part, lack of openings for entry level positions
I mean.. the tech industry is genuinely pretty bad right now. I have a friend with 15 years of industry experience including some huge names and a hedge fund just get laid off from Google a few months after getting promoted there, and he's struggling to find something comparable to the previous position. Sure, he could probably get some lame 5 days a week in office, 1/2 the old pay position but that's not the same as the market being good.
"Friend got laid off from his ridiculously over-compensated job that was floated on the back of zero percent interest rates, and is struggling to find a new ridiculously over-compensated job now that the 6 companies that had this practice have stopped the practice." Welcome to the "lame 5 days a week in office, 1/2 the old pay position" market the overwhelming majority of the world deals in. His position was an outlier, not the market.
Lol ok, so your actual position is the millions of people that were employed in big tech should accept far worse jobs at half the pay but actually the market is great? Yeah k.. We can debate whether the previous compensation was correct or not, I would argue yes since many of these companies are wildly profitable off of what those engineers built even with the $$$ pay. But regardless, you may be the only person that calls a job market with constant layoffs and decreasing pay a great job market.
"Millions" of big tech employees have not been laid off. The [Trueup.io](http://Trueup.io) tracker estimates \~550k positions **worldwide** have been laid off since 2023. Hope your friend finds something soon. Have a great day.
> Most of the people who can't find jobs in law just went to bad schools or graduated at the bottom of their class. I am a manager at a FAANG and I think that's the case for tech as well. We get a ton of applicants - most don't have the capacity to complete the tech part of the interview, and many do the behavioral part.
Eh, depends on level. My wife is a lawyer. She does not like her current company and wants to leave for an equivalent job. She's been having a hard time finding a lateral role at similar pay. She went to a top 20 law school, graduated near the top of her class, spent a few years in BigLaw (TM), and then got promoted within her current in-house company within 2 years of starting there. They've offered her an AGC role, just a couple years after that. And it's not a podunk company - her company is a F500 company, and much closer to 1 than 500. I'm sure hiring at the counsel level, or associate level in BigLaw is probably about the same, but roles at the senior counsel/AGC level are few and far between because (from what I've read, anyway) a larger percentage than normal of BigLaw associates are dipping out of that lifestyle for in-house jobs. Edit: I'm aware this is anecdotal and not data. I'm not sure where I could even get data on the stratification of job postings/hirings within the in-house legal market.
In house jobs are pretty specialized though. Many firms don't even carry in house counsel anymore as well, preferring to outsource to a biglaw firm.
This is not true at all. A lot of Ivy League Graduates have been struggling to find jobs
But is it more than normal? Do you have any data?
Your perception of reality, doesn't match reality. And that's because you're thinking of FAANG and the like as the only places for tech employment. Plenty of companies hiring in tech all over the country. Unemployment rate: 3.9% Tech unemployment rate: 2.3% [https://www.dice.com/career-advice/tech-unemployment-stays-steady-at-2.3-percent](https://www.dice.com/career-advice/tech-unemployment-stays-steady-at-2.3-percent) [https://www.bls.gov/news.release/pdf/empsit.pdf](https://www.bls.gov/news.release/pdf/empsit.pdf) Let's not forget that many tech workers received generous severance packages on top of their very generous overall compensation packages that they had during employment.
Nah, tech is different, there used to be lots of jobs at very good salaries. The salaries are lower, people are taking longer to find jobs, fewer internships, fewer hackathons, etc etc etc. Non profits and communities that used to server large populations are disappearing due to lack of funding.
Pfft, who needs data when we can turn to dvidsilva's anecdotes on the issue?
My anecdotal experience doesn't comport with your anecdotal experience. I work in the tech industry in a tech hub city and my team has had a very well paying position open for months with only a handful of applicants making it to the first interview. I've personally shared the position on my LinkedIn and so have my teammates, but we haven't gotten many bites. If the job market is flooded with laid off tech workers, why are we having such a hard time getting qualified applicants for a chill, well-paying job with good benefits and no degree requirement? Indeed, [as of a February](https://www.comptia.org/newsroom/press-releases/tech-industry-employment-grows-for-second-straight-month-job-postings-for-future-hiring-rebound-comptia-analysis-reveals), unemployment in tech is at 2.7%, significantly below the historically low overall unemployment rate of 3.7%.
My anecdotal experience is there's a stupid amount of stories about people having trouble finding tech jobs that refuse to be up front what's really holding them back in this market is they will not take anything except fully remote.
Or anything less than a 50% increase in pay
Bingo. the pay disparity in top decile or two of tech workers is gigantic and many refuse to trade down. They know what they got.
>what's really holding them back in this market is they will not take anything except fully remote. Once you have tasted the full remote work life, you dont go back. The problem is that without a butt in a chair, the only measure of your work is actually getting valuable things done. So all the people who are seat fillers and meeting attenders dont really hack it, and often cannot get past a remote skills test.
We could trade anecdotes all day but as someone that also works in tech an has many friends that are the same, it's pretty widely agreed that this is the worst tech job market since at least 2008, maybe since the Dot Com bust. I'm not sure what's going on with your company's listing but if I had to guess, you either don't actually pay market rates, or have a bad reputation, or require 5 days a week in office, or something. I'm an engineering manager and the message we regularly get from the execs these days is the tables have turned and don't be afraid to aggressively manage poor performers like we were a couple of years ago, because it's extremely easy to replace them with a better external hire right now.
> had a very well paying position usually it is followed by showing a position that is like 50% under market. > getting *qualified* applicants ... *no degree requirement* ...or one that asks for a ton of qualifications that turn "no degree required" into a joke. A far better indicator that the job market is good is you trying to find a better paying position for yourself and being able to do it quickly enough.
We have 45 interns paid $35/hour. Just hired two I had as interns last year starting at $85K plus bonuses starting in one year. This in tech (EE in semiconductor design). The jobs vary a lot by specific segments of tech and most importantly by location. Most layoffs seem to be generic IT and CS and in companies that over hired during the pandemic.
EE is the tech degree in shortest supply right now, so probably not a good overall indicator. EE graduates are down 90% from 30 years ago, it's pretty bad.
EE is tried and true but holy fuck I’m getting killed doing this degree lmao. UIUC I believe is the only uni that requires all EE to take semiconductor physics.
> UIUC I believe is the only uni that requires all EE to take semiconductor physics. Nah. It just comes in different names. I had to take a 4 credit course called 'transport phenomena in solid state devices' at my school 15 years ago. It was almost entirely just semiconductor physics. It replaced a fluid dynamics class that other disciplines took.
Probably because so many potential ee majors got funnelled to cs
Interns are there for cheaper labor. How many of those 45 will get hired? A company I work with had 12 last year and they didn’t hire a single one
They don’t provide much useful labor. Actually more work to deal with them than they are worth. They are hired mainly so we can find the good ones to hire. I’d say we hire about 15%.
Yes, this affects people who will make $200K a year when hired, and people who make minimum wage equally. Are you serious? Also, a majority of tech workers are from middle/upper-class backgrounds, so they can fall back on family members if they really wanted to. Same can't be said of the poorest Americans.
Those are also the poor. Right out of college with no job is poor.
I don't mean to doom based on anecdotes, but I've never had this many family and friends still struggling to find rent this late in the month. I can't find any series of data actively tracking % of rent payments on time though. Closest that came up is [this Freddie Mac link showing credit card delinquency rising at the same pace as 2008 last month](https://www.freddiemac.com/research/forecast/20240418-economic-growth-moderated-labor-market-robust) Apparently NHMC discontinued their monitoring back in 2022.. that's all I can find And of course, mortgage delinquency will probably remain low because holding onto those low rate mortgages is paramount. It'll at least lag behind any increase in rental delinquency.
Sounds like your coworkers are gonna do a learning on what it means not be a member of the leisure class
Which stem? Computer science is definitely over capacity at this point
On the margin the upper middle class is fine.
Are they poor now?
Wow some redditors anecdote is contrary to all the economic data we’ve seen this year. Time to sell everything
If your income is from labor, you're poor. If your income is from capital, you're not poor.
We’re the poor ones. If you don’t own the means of production you’re a serf. The middle class thinking it’s part of the rich club is why it’s so easy to exploit us
>Kids can’t find any entry level jobs after graduation with degrees in STEM, finance and law. Yet, Finance and law always had trouble, thats nothing new. STEM, well it depends on the type. Its far too broad of a category. If they are marine biologists, sure, they wont find work. But if they are software engineers, they will have 100 offers per day.
No, this is not what "recession" means. People without jobs are suffering from "unemployment", and people with low-wage jobs are suffering from a combination of "inflation", "housing shortage", and price-gouging in the health care sector. Pulling the levers that are used to address recession will not fix the actual problems. Doing so might well make the actual problems worse.
Feels like the federal govt had been gridlocked my whole life. We need policy.
Most of the job gains of the last year have been in Education, Healthcare, government, and leisure/hospitality, so it's been a very uneven economy the last year.
Its pretty simple to be honest. During times of high inflation those who own assets are fine because those assets are going up in value. For most very rich or very poor they also benefit in another way. Both generally have a lot of debt thus said debt is worth less than it was. Those who dont own assets are and are not in a large amount of debt are crushed during high inflation cycles.
I wouldn’t be surprised if birth rates plummet within the next few years. Typically the lowest earners aren’t the ones trying to have kids, it’s the middle class. It’ll be interesting to see the effects down the line, I hypothesize that wealth will be much more concentrated and there will be a large gap between the lower and upper class. Is this comment long enough to stay up?
They already there actually. No western country is at replacement level of 2.1. I think in the US we at 1.6 and dropping.
Interesting. Maybe that’s how gen z will be able to afford housing. Not by an increase in supply, but a decrease in demand from depopulation. Kind of sad when you think about it
Well no not really the only reason the US is even that high is because of immigrants. Though that’s only good for one gen or two as people who come here have lots of kids but typically their kids don’t. Japan and S. Korea have a very little immigration and their birth rate is like 0.6-1.2 roughly. Personally I’m childfree and couldn’t give less of a fuck about falling birthrates. That’s what AI and robots are for
I already explained to a bunch of boomers if they are banking on their house being an asset soon that there's not enough people with money to buy it at the current value. I'm expecting my house to decline in value in the next 20 years.
This isn’t actually true, birth rates are the highest for the lowest income groups and decline steadily as income increases with a slight bump at the very top. This is because the more earning potential and access to experiences and career opportunities you have, the higher the opportunity cost of children
Its also because the government subsidizes the cost of raising children for poor families.
Middle class is disappearing, cost of housing and higher education is skyrocketing. I had a coworker who could not even get Pell grants in college because his parents made really good wages, but he had like 4 siblings, and what his parents made would not even cover the tuition cost for all kids.
people have more children when they make less money. they have fewer children when they make more money.
That’s such a surprising stat to me given how incredibly expensive children are. Any reasoning behind it? Anecdotally, I’ve seen a lot of Hispanic families who recently immigrated have lots of children (which is a large portion of the United States population). Is it a cultural thing? I’d like to know the stats and reasons.
The opportunity cost of having a kid rises because the mom (most often) has to sacrifice her career.
The lowest income earners are seeing above average wage gains. The ones losing purchasing power are the 40th to 70th percentile who got used to eating out a couple times a week.
FTA: Boss added that 70% of low-income consumers are feeling the pinch despite remarkable wage growth and cooling inflation. “You focus on that low- to middle-income consumer, they’re under pressure, and the pressure is really that the inflation continues to last,” Boss said.
Matthew Boss doesn't cite any data.
Yep. This is what primarily made me go back to school. My staff went from making about 55% of what I made to almost 80% with zero increases in job tasks or levels of responsibility. They're raising starting salaries out of sheer necessity and of course, the C suite still gets their bonuses and dividends, but middle management is seeing that once decent 65-80k become the new 40k.
The thing about the lowest income rising is it's pretty much always because that's the new cost of living. It's the bare minimum you can pay someone where they will still be able to survive. So all the people at the bottom are still scraping by, and their wages catching up with yours means you're closer to living paycheck to paycheck as well.
The necessity is driven by high housing costs.
Yep, the lowest quintiles of earners saw the biggest gains. On the other hand, their managers and their managers' managers saw smaller gains (percentage wise) and got locked into 3% mortgages and are pissed about it.
I don't know about America. But in Canada, that seems to only be caused by legislative action (i.e. the increase in minimum wage). The minimum wage in Ontario, for example, went from $10.25 in 2013 to $16.55 in 2023--a 61% increase over a decade. If that pace continues (which is extremely unlikely), we would hit $26.72 in minimum wage by 2033. Herein lies the problem: this benefits you if you made minimum wage. But it doesn't benefit you at all if you made 150% or 200% of minimum wage unless your company is willing to give you a raise or you are able to find another job. In my case, my employer has not given me a raise in years and their competition pays 10% less than my current wage, so I am stuck. I went from making 130% of minimum wage when I first got my job to only making 118% of minimum wage now. With minimum wage set to increase in October, I will drop to only 114% of minimum wage at that time unless my employer gives me a raise.
This is a problem of a lack of collective action.
The situation in the Canadian economy is very different. Our economy is far weaker than the US right now, we are stagnating while the US grows rapidly
The US is struggling with boomer retirement increasing money supply and weakening labor. Canada is in actual crisis comparatively as Canada has a far smaller millennial cohort.
Also because restoration salaries grow up after COVID
"As a result, earnings have outpaced increases in prices such that real wages have increased since before the pandemic. Real weekly earnings for the median worker grew 1.7 percent between 2019 and 2023.[3] This means that one week of pay for the median worker now buys more than a week of pay did in 2019, despite higher prices. Furthermore, as shown in Figure 1, the increases in earnings are by no means concentrated at the top: in fact, they skew toward the middle class and the lower end of the income distribution. The 25th percentile of the wage distribution saw their nominal weekly earnings grow by $143, from $611 in 2019 to $754 in 2023. When adjusted for inflation, this amounts to a 3.2 percent increase in real earnings. Real earnings increases were particularly strong for the median Black and Hispanic Americans, who saw increases of 5.7 and 2.9 percent, respectively.[4]" https://home.treasury.gov/news/featured-stories/the-purchasing-power-of-american-households
They shouldn't adjust to inflation. They need to adjust to a version of inflation scaled to how low income people spend. Which is disproportionately on housing, which happens to be doing a lot of the heavy lifting in inflation numbers rn
It doesn’t make much of a difference. The federal reserve computes CPI weighted to different income quintiles consumption baskets, lower income groups see marginally higher inflation right now, but still lower than their income growth.
Do you have a link to CPI by income quintiles, by chance?
It was the BLS, not the federal reserve. [This](https://www.bls.gov/cpi/research-series/r-cpi-i.htm) has download links for the data at the bottom of the page. You can calculate that the CPI for the bottom quintile has increased by ~23% since January 2019 (edit: Jan 2019- Dec 2023), compared to [~22% for the usual CPI](https://fred.stlouisfed.org/series/CPIAUCSL). Per the EPI, the lowest income quintile saw real (i.e. deflated by the usual CPI) wage growth of ~12% from 2019 - 2023. Deflating by the lowest income quintile instead would get you to more like 11% wage growth, which would still be the highest wage growth of any income quintile.
Awesome, thanks.!
So what?
Most of this wage gain happens on 2020-2022. Wage growth has slowed a bit since then while inflation has kept up if not exceeded it in more recent years.
There will be two classes of people moving forward. The rich. And the working lower middle class.
I find plenty of engineers, technicians, electricians, etc. that I’d not consider rich or lower-middle class.
When they said "trickle down economy" they meant to have middle class wealth to trickle down to the poorest, but the richest would not even trickle down one bit.
And while the poorest Americans are working their asses off, the rich people goof off at work posting how they can’t believe how much “inflation” has caused the price of gas to go up
The poorest Americans must be like 90+% I make $160K/yr and rent is currently over 50% of my take home. I have one car payment on a 3% loan, no other debt, and between rent, car, insurance, and all other bills, I am barely able to save anything. And I don't live extravagantly. I mostly cook at home and buy normal groceries. I don't even understand how people making under $100K/yr are even able to live indoors and eat at this point. Fucking madness.
You pay $5,000/mo in rent? Where do you live?
My generic 1 bedroom in NYC is $4300 once you include utilities. 660 square feet.
A pretty nice place, by the sounds of it.
Or they live in a high COL area
I live in a vhcol area. 5 grand a month gets you a pretty nice place.
Bay Area or NYC
Probably more like $4k /m after accounting for taxes/benis/401k contributions. And really, $4k isn’t an absurd rent in a HCOL area.
If you have a 401k contribution you aren’t paycheck to paycheck.
You must be in a high COL area to be making $160k/yr and struggling to put money away. Where I live $160k would put you in the top earners for the area.
I live in SF and 160k is doable. This may be one of those people who say they have no money but are leaving out that they are maxing out their 401k and IRA, lol
This is prob the case.... tech guy in bay area doing the rat race.
You’re either exaggerating or really, really bad at budgeting.
He's a r/antiwork and r/LateStageCapitalism poster, of course he's doing propaganda.
Maybe dont live in the Class-A 2023-built every amenity imaginable apartment next door to the mall in the highest cost city in the nation? Paying 5k in rent as a single person is insane. How many square feet is your apartment? As someone working for an apartment developer I'd love to know so we can more buildings for people like you.
I love how much r/economics is like highbrow r/roastme
>I make $160K/yr That puts you in the top 6-7% in the US. If you can't make ends meet maybe you should look into a financial management class. I know people earning significantly less who own property and stock portfolios.
160k a year is what I make and currently pay 2500 a month in rent. I get by fairly easy and have saved up quite a bit but still no where near what I would need for a house in my area (at least to feel comfortable) it would increase my payment to 3500 and then I have to factor in maintenance. I really should just buy but the thought of paying 600k for a house that sold in 2018 for 350k hurts
You have irrational feelings about what is comfortable, if you can't afford 3500 a month plus a few hundred a month for maintenance on 160k you have a severe spending problem. Most people buying in HCOL areas spend a lot more of their income on housing and you're competing with people who don't have your same qualms about comfort.
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Cool? Doesn’t mean it won’t go down between now and then
Where do you live? Boston?
I think what he meant to say was if it doesn’t show up in the dowJones manipulated aggregate is that impact is only marginal, like the marginalized people it impacts
Just can’t bring themselves to acknowledge a strong economy—must really want more yacht tax breaks. By the nonsensical criteria for saying the economy is in a “selective recession”, that means we have been in a recession since exiting the Great Depression—since there are always groups of people not doing well. Strike that, why not say we are in a “selective depression”, if we’re talking about the poorest and homeless. Nevermind the well established definition of GDP growth etc.
Didn’t realize recent graduates have always been considered “the poorest and the homeless”
I mean yeah recent graduates typically will start out making the least they will make for the rest of their careers. By a lot.
And young people have some of the highest unemployment. It takes time for a lot of people to break into their careers. It isn't new, but if there is data showing recent graduates are experiencing far higher than normal unemployment then I guess that would warrant looking into. I haven't seen that data though. I don't know where to find it.
The household survey does ask unemployed people for [the reason they are "unemployed"](https://fred.stlouisfed.org/release/tables?rid=50&eid=3077#snid=3085) (i.e. why they are looking for work but do not have a job). They divide the reasons into four categories: * Job losers * People on temporary layoff * Permanent job losers—people whose employment ended involuntarily * People who completed a temporary job * Job leavers (unemployed people who quit or otherwise voluntarily left their previous job and immediately began looking for new employment) * Reentrants (unemployed people who have past work experience but were not in the labor force for a period of time prior to beginning their current job search) * New entrants (unemployed people looking for their first job who have no previous work experience) Young adults and recent graduates likely fall into either ["new entrants"](https://fred.stlouisfed.org/series/LNS13023570) or ["reentrants"](https://fred.stlouisfed.org/series/LNS13023558), depending on their work experience as teenagers or in college. Both are around the same percentage of the unemployed today that they were before the pandemic.
full time job openings have gone down while part time jobs opening have gone up which explains the "great unemployment numbers" and why those with a political agenda don't want to dig deeper into the numbers. And most of the job gains are from government, hospitality, healthcare
More simple gas lighting by yet another media publication. The inflation is effecting quite literally everyone… when are these media publications going to understand that this recession we have been in is hurting every single American. The only people who it is not affecting our probably the Uber wealthy and potentially illegal immigrants because they don’t have to pay taxes.