70% of Americans consider themselves middle-class and they’re hurting
KEY TAKEAWAY: The middle class now makes up just over 50 percent of the total U.S. population, according to a report from Pew Research Center, which used 2016 data. That’s compared to 61 percent in 1971. Today, being middle-class involves an endless series of trade-offs and creative workarounds, career reinventions and an inescapable sense of dread.
There is an excellent article in the Tim es entitled “ What Middle-Class Families Want Politicians to Know “. It’s an eye opening deep dive into today’s middle-class families who are struggling even with salaries of $150,00. Here are some excerpts:
“Middle-class life is now 30 percent more expensive than it was 20 years ago,” the journalist Alissa Quart writes in “Squeezed: Why Our Families Can’t Afford America.” And yet, for all the talk of “everyday Americans” among the presidential candidates, politicians do not seem to understand what it takes to get through the day, or what would really help. Although we make over $150,000 a year, we are lower middle class in the San Francisco Bay Area. We cannot buy a home here, our cars are both over 10 years old, and we don’t eat out more than a couple of times per month. We have a college fund for our son, but no real savings. I can see that there are two kinds of young people: the ones who have student-loan debt and those that don’t. It’s the ones who don’t who are buying condos now, who are getting married. And I want my child to be one of the lucky ones. I am hellbent that my daughter will not start out with a millstone around her neck My parents are elderly, and unless they have expensive end-of-life issues, I am likely to inherit something that will help make up the loss out of our daughter’s 529 college fund. But I’ve got to work until I’m at least 70 to make all this work. Colleges need to be more affordable. The harsh terms of college loans and the insane cost of college feels like a scam that is undermining the benefits of higher education. Every dollar that I have earned is through capitalism, but there needs to be something more to make this work. There is an extraordinary burden on my generation to fund our own retirement and also afford college costs for our children. It’s almost guaranteeing that we won’t retire at the same comfort level as our parents if we can retire at all.
I feel stress daily to constantly save money. I shop for groceries in the least expensive places: I know where I can get decent meat and vegetables, still organic, but close to the expiration date so I can buy it at a discount. Sometimes, I’ll stop myself. I think about how much money my ex-husband and I make, and I think, “Why am I in this position?”
Employers used to bear a lot more of the burden of supporting families, with good, inexpensive health insurance, and pension plans. Companies need to reassess their relationship with their employees. Something went wrong there, and that’s having a huge impact on society.
How are brands responding?
They’re raising prices. Raising prices as input costs rise was not possible in the years after the financial crisis, so some sticky pricing is seen as a positive thing for the stock market, since it boosts both profits and confidence.
Tarriffs are not helping either, they’re hurting middle class consumers. The prices of the things we buy, from floor lamps to canoes and bicycles, are going up as the Trump administration makes good on a promise to raise tariffs on $200 billion worth of imported Chinese products.
A recent study calculated that the 25 percent tariffs imposed on China would cost the average American household more than $800 a year, according to a blog post from the New York Federal Reserve. Tariffs on goods from Mexico, which were set to kick in Monday before Trump announced they would be indefinitely postponed late Friday, would have added to that toll. Here are real-world examples of how the trade war might play out at the cash register.
And marketers wonder why people are purchasing more store brands and less national brands..sigh.
Originally published at https://www.newmediaandmarketing.com on July 5, 2019.