29% of households have jobs but struggle to cover basic needs

[trophy33]

29% of households have jobs but struggle to cover basic needs: They are ‘one emergency from poverty,' one expert says

Nearly 40 million families, or 29% of the population, are defined as ALICE, which stands for Asset Limited, Income Constrained, Employed.

www.necn.com

 

[essentialsaltes]

That figure doesn't include the 37.9 million Americans who live in poverty, comprising 11.5% of the total population, according to data from the U.S. Census Bureau.

Yay, Biden has reduced the number of people living in poverty!

From United for Alice report 2020

 

[trophy33]

That figure doesn't include the 37.9 million Americans who live in poverty, comprising 11.5% of the total population, according to data from the U.S. Census Bureau.

Yay, Biden has reduced the number of people living in poverty!

From United for Alice report 2020

View attachment 346874

Its terrible, its almost every other person (half of the US population) that either lives in poverty or struggles with it.

 

[essentialsaltes]

Its terrible, its almost every other person (half of the US population) that either lives in poverty or struggles with it.

Certainly, but in terms of 'news', the situation is largely unchanged over the past 6 years.

A certain somebody said something to the effect of "There will always be poor people."

What matters is how we, individually and collectively, treat them.

 

[trophy33]

Certainly, but in terms of 'news', the situation is largely unchanged over the past 6 years.

A certain somebody said something to the effect of "There will always be poor people."

What matters is how we, individually and collectively, treat them.

There will always be some poor people, but almost the half of the population of a developed "the richest" country is perplexing.

 

[Tropical Wilds]

I’ve been told that if people stop spending money on coffee, they’d be fine financially.

 

[ThatRobGuy]

This is one of those where people need to really get granular with the numbers in terms of seeing how certain policies are (or aren't working)

I think dividing into only 3 buckets
1 Poverty
2 One Emergency Away from Poverty "just getting by, but not comfortably"
3 "Okay"

...is too broad. Along side employment numbers which can also be leveraged in a very misleading way to give a "rose colored glasses" view that may not line up with the realities that people experience.


For instance, if there were a situation where
- 4 million people moved from bucket 1 to 2, but there were also 5 million people moved from bucket 3 to 2.
- 2 million full time jobs were lost/replaced with 4 million part-time jobs.

It would technically be accurate to say "there are fewer people in poverty and unemployment is down", but the fact that there's an even greater number of people no longer living comfortably that were able to before is just as important of a facet in the overall conversation.


If you had 100 people
1 is filthy rich, 70 are okay, 20 are just getting by, and 9 are flat out broke

Replacing that with
1 is still filthy rich, 40 are okay, 55 are just getting by, and only 4 are flat out broke

...isn't exactly the "win" people often like to advertise it as.

 

[ThatRobGuy]

I’ve been told that if people stop spending money on coffee, they’d be fine financially.

While it's obviously a disingenuous "boomer answer" when people suggest "if you didn't buy that expensive starbucks, then maybe you'd be able to afford a house" (as if $30/month on coffee is going to be the deciding factor on if someone can afford a $400k home at a terrible interest rate)

...but I think it's one of those things where there is a measure of truth with regards to the sentiments about spending habits of younger millennials and genZ where they're certainly not helping themselves in some facets.

Two things can be true at once.

85+ Stats on Gen Z Spending and Buying Habits (2024)

The latest data on how, when and where Gen Z spends their money.

explodingtopics.com

42 Statistics on Gen Z Spending Habits in 2023

Gen Z spending power is on the rise, so understanding Gen Z shopping habits is crucial for brands over the next decade.

ecocart.io

Now, would reducing/adjusting any of these spending habits be a "game changer" with regards to them being able to get their piece of the "American Dream" like previous generations did? Likely not, there are still some things that need to change systemically.

But at the same time, statistics like ones listed in the links (46% spending more on fashion than other category, 30% spending more on beauty care products than any other category - more than any other generation, and being 2-3x more likely to buy clothing every week than any other generation, spending $2,000 a year on products for their pets, etc...) aren't necessarily helping their stated case in terms of being taken seriously.


So one can understand why it maybe rings a little more hollow when the "It's not fair that you were able to buy a house so easily when I still have to rent" is coming from someone carrying a bag full of $85 worth of stuff from Sephora and spending $90/month on various streaming services.

It doesn't make their point invalid, like I said, just makes it so a lot of people won't take it as seriously or will be more likely to be dismissive.

It's possible for a younger generation to be both A) getting a raw deal, while B) simultaneously being not-so-great with regards to prioritizing.

 

[RileyG]

If I stopped using doordash and buying cocktails I would have thousands of more dollars. It’s my own stupid spending habits.

 

[trophy33]

Regarding the new topic - small vs big luxuries, people will give up big luxuries (like an expensive car or a big house) more easily than small luxuries like a cup of coffee or netflix, because the small luxuries provide constant small joys throughout the life while the big luxuries become a burden.

 

[Chesterton]

I can't prove it, but my hunch is that if you go back 100 years, or 200 years, or 1,000, you'd find that at least 29% of households have always struggled to cover basic needs. Possibly even a higher percentage. After leaving Eden, there's never been a utopia and there never will be.

 

[RileyG]

I can't prove it, but my hunch is that if you go back 100 years, or 200 years, or 1,000, you'd find that at least 29% of households have always struggled to cover basic needs. Possibly even a higher percentage. After leaving Eden, there's never been a utopia and there never will be.

Well said.

 

[ThatRobGuy]

I can't prove it, but my hunch is that if you go back 100 years, or 200 years, or 1,000, you'd find that at least 29% of households have always struggled to cover basic needs.

I don't know that it makes a ton of sense to compare ourselves to pre-1900 era, I think that's a hard dividing line when it comes to evaluating standards of living. The poorer people in America today would never want to live like the richest person from before that time. That was a whole different ball game.

With regards to more modern history
...as the saying goes "Optics is everything"


The definition of what constitutes "middle class" and "basic needs" has radically changed as well. In some ways that are practical, but in others that are impractical.

The proof is in the types of houses that were built in the 40's and 50's compared to the houses that are built now. A 1500 sq ft home for 5-6 people with one tv if you're lucky and one car for the entire family was considered "middle class". That's not the case today.

 

[ThatRobGuy]

If I stopped using doordash and buying cocktails I would have thousands of more dollars. It’s my own stupid spending habits.

...but like I noted before, two things can be true at once.

We could all probably find some things that we spend a little too much on that would be best if diverted toward savings or something else.

And while it's true that GenZ seems (from all the available data) to be worse at those prioritizing exercises than other generations. Their gripes still have some validity.

If you take 2 people who are 26, both making $45k/year...

One saves next to nothing, spends their money on the latest phones, trendy clothes, etc...
The other is extremely frugal and lives as cheaply as they possibly can, eats all meals at home, put almost every additional dime above and beyond their bills in savings, etc...

The thing those two people have in common? Neither will be able to buy a house in the suburbs and start a family by 30 without seriously struggling.


Unlike what the boomer generation was able to do back when they were their age with relative ease (thanks to the favorable conditions the US had in the manufacturing sectors in the 2 decades following WW2 due to the rest of the world being in the rebuilding process after the war)


Point of reference, in just doing a random browse of some real-estate (this is from a town that's about a half hour way from me here in Ohio...which is a relatively "cheap" state to live in)

And extremely modest home that needs work. $249k.

If you have an 800+ credit score and 20% to put down (which most people in their 20's do not)...here's what you're looking at:

Almost $1800 (plus whatever utilities would cost)...after utilities, you're probably looking at around $2100 a month.

Per the IRS
After tax take home pay for someone in Ohio making $45k/year and making a modest 2% contribution to their 401k and paying $125/month toward a company health plan would be in the ballpark of about $2550/month.

In a nutshell, what the boils down to is that even the most financially responsible young person is going to have an extremely difficult time making that work with what little money they had leftover after covering bills and food.

So it's not surprising that most don't go that route.

If you were 26, would you want to be "house poor" just so you could live in a place that will need thousands of dollars of work and that's in a "meh" neighborhood? That kind of "pick your poison" decision isn't one that the boomer generation wasn't faced with when they were in their 20's. People from that era "doing everything right" could comfortably afford to buy a home by the time they were 23 if they got a job at the local factory when they were 18 and saved their money.

 

[Chesterton]

I don't know that it makes a ton of sense to compare ourselves to pre-1900 era, I think that's a hard dividing line when it comes to evaluating standards of living. The poorer people in America today would never want to live like the richest person from before that time. That was a whole different ball game.

With regards to more modern history
...as the saying goes "Optics is everything"


The definition of what constitutes "middle class" and "basic needs" has radically changed as well. In some ways that are practical, but in others that are impractical.

The proof is in the types of houses that were built in the 40's and 50's compared to the houses that are built now. A 1500 sq ft home for 5-6 people with one tv if you're lucky and one car for the entire family was considered "middle class". That's not the case today.

I don't see 1900 as a hard dividing line. It takes different forms, but people had to struggle before the Industrial Revolution, and people have to struggle after it.

And the linked article is about "meeting basic needs", not "being middle class", which you seem to note, are two different things.

 

[wing2000]

I don't know that it makes a ton of sense to compare ourselves to pre-1900 era, I think that's a hard dividing line when it comes to evaluating standards of living. The poorer people in America today would never want to live like the richest person from before that time. That was a whole different ball game.

With regards to more modern history
...as the saying goes "Optics is everything"


The definition of what constitutes "middle class" and "basic needs" has radically changed as well. In some ways that are practical, but in others that are impractical.

The proof is in the types of houses that were built in the 40's and 50's compared to the houses that are built now. A 1500 sq ft home for 5-6 people with one tv if you're lucky and one car for the entire family was considered "middle class". That's not the case today.

I grew up (late 60's, 70's) in a 1200 sq foot home with 1.5 bathrooms with no A/C and thought we lived in a nice house. There was one landline phone ($6 a month) one 19" TV with rabbit ears, a well for our drinking water and a large garden. Going to McDonalds (or any fast food place) was rare. Nicer restaurants - rarer still. My mother did not work outside the home until the kids were nearly gone and my dad worked at a Mack Truck engine factory, with good benefets including health care (thanks to the UAW). When dad came home, he was off work - no after hours calls (or text, IM's etc to the work mobile phone . Sunday was a day of rest and recreation. Times were simpler. Our material expectations were lower. And, IMO, we were happier as a society.

 

[FireDragon76]

Its terrible, its almost every other person (half of the US population) that either lives in poverty or struggles with it.

Alot of is due to institutional forces in the US that have locked millions of Americans into costly, unsustainable and environmentally destructive lifestyles, so oil companies and agribusiness get rich.

 

[ThatRobGuy]

I don't see 1900 as a hard dividing line. It takes different forms, but people had to struggle before the Industrial Revolution, and people have to struggle after it.

And the linked article is about "meeting basic needs", not "being middle class", which you seem to note, are two different things.

Because if you're not at least middle class, you are "struggling"

If one is below that dividing line, they're basically one unplanned expense/emergency away from being in serious trouble.

Sure, if your monthly home payment plus all other bills/food come up up to $2,000/month, and your take home pay $2100... you're "meeting your basic needs". Until your car breaks down and you can't get to work, or the furnace breaks and you end up with a $1800 repair bill you weren't expecting, etc...

 

[ThatRobGuy]

Alot of is due to institutional forces in the US that have locked millions of Americans into costly, unsustainable and environmentally destructive lifestyles, so oil companies and agribusiness get rich.

Another huge part of it (that I touched on a little earlier), is that the US was in a position where we were riding high in the 2 decades post WW2 due to much of the rest of the industrialized world having to rebuild after the war.

It's easy to have thriving manufacturing and automotive sectors (while having unsustainable business practices) when there's only very limited global competition.

You can do things like pay 5 people for jobs that you could easily get by with 3 people for, overcharge, and not have much concern for efficiency when you're "the only game in town"...and while that's good for the workers themselves for that finite period, it's not good for the industry as a whole.

My family had several people (uncles, 2nd & 3rd cousins) who either worked for the Cleveland steel plant for the Ford plant... They were able to do so right out of high school, and make great money (for the time) for someone their age. And they would even joke about some of the stuff that went on. Things like 4 guys being tasked with keeping one machine running, they'd take turns checking on it and playing pinochle for a good chunk of the day. Work slower in the morning so that at noon, when the boss makes his rounds, it looks like things are behind and he asked you to work a few extra hours (at time and half OT rates) to get "caught up", etc...

You can get away with not scrutinizing that stuff when you (as a country) are one of the only supplier countries.

However, once other countries like China, Japan, and Germany started recovering and competing in some of those markets, and their efficiencies resulted in lower prices for buyers, the US model (that had been "working" due to having a quasi-monopoly) no longer was.

Case in Point: By the late 60's early 70's, Japan had largely recovered and began making their own cars that were functionally equivalent (and in some ways better) for a lower price point. By 1975, US auto plants were doing quite a few layoffs and resorting to cost cutting measures like closing their plants 1-2 days a week.

And that problem was compounded by the fact that retirees on guaranteed pensions (that were locked in back when the US was fat & happy) still had to be paid, and there were fewer workers paying into it due to the layoffs, which resulted in them having to jack up the price of cars (which hurt everyone)

 

[Chesterton]

Because if you're not at least middle class, you are "struggling"

If one is below that dividing line, they're basically one unplanned expense/emergency away from being in serious trouble.

Sure, if your monthly home payment plus all other bills/food come up up to $2,000/month, and your take home pay $2100... you're "meeting your basic needs". Until your car breaks down and you can't get to work, or the furnace breaks and you end up with a $1800 repair bill you weren't expecting, etc...

Trust me, you don't have to explain this to me. Unfortunately, I may understand such circumstances better than most people on these forums.

All I'm saying is that I think it's always been this way. Throughout history, there must have always been a spectrum of financial well-being ranging from the homeless person who owns nothing but the clothes he's wearing, to multi-billionaires. And if there's a spectrum, there must have always been people who fall into the range of the spectrum that the OP is discussing.

Also, I think your position might be a bit tautological. Seems you're saying that people who don't have/make enough money, don't have/make enough money (for whatever purpose, such as avoiding poverty in case of the occurrence of a costly emergency). Of course I agree with that, and I wish it were otherwise.