Incomes Even Lower Since Recession Ended


Feeling poor and like your paycheck isn’t stretching as far as it used to?† You’re not alone.† According to a new report from the U.S. Census Bureau, household income has fallen almost 10 percent since the recession began in December of 2007.† And even worse, the decline became twice as great in the two years following the recession than it was during the recession itself.

So how does that happen?

According to Politico, both decreases in income were “highly correlated with high levels of unemployment, increases in the duration of unemployment and the large number of persons who have experienced ‘employment hardship.’”

Of course, recession doesn’t actually relate to unemployment, although the two tend to go hand in hand, but to the growth of the economy in the country.† Two down quarters in a row mark a recession, and one up quarter marks “the end” regardless of the state of employment, pay or other factors that actually have an impact on people versus economic indicators.

As long as the economy is growing — or officially no longer shrinking — there’s no real incentive for businesses to increase pay, bring back cost of living increases, add overtime or even stop laying off workers.† And for those workers they do hire back, a lower initial wage can and is being offered.† Workers are supposed to feel so grateful to have a job that any money is enough, something corporations, looking to expand their profit margins, are relying on.

It’s no wonder that the drop in income has been the most drastic in households of families led either by adults under the age of 25 or African American heads of house.† Those two groups have had the largest percentage of unemployment, and are the most likely because of it to take anything offered, having no resources to hold out for something better or higher paying.

As long as job insecurity goes hand in hand with corporate greed, it doesn’t matter if the economy is in a recession or a boom.† Either way, household incomes will continue to suffer.


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Photo credit: revisorweb


W. C
W. C12 months ago

Thank you.

William C
William Cabout a year ago


Margaret C.
Margaret C6 years ago

THANK YOU, Jonathan Y. and Rosalind R. I was surprised to find out that it had ended, too! Or maybe it just ended for the rich, because where I am, people are still going to food shelters and homes are empty because of foreclosures (and the banks can't unload them), and the jobless rate is still 8%!

Rosalind R.
Rosalind R6 years ago

WOW, when did the recession end?
Oh yes, now I remember ---it was when the New Depression began!
Bah Humbug!

Marie W.
Marie W6 years ago

Reinvent capitalism.

Mercedes Lackey
Mercedes Lackey6 years ago

Part Three:

6. Social Security is a Ponzi scheme.
Don’t believe it. Social Security is solvent for the next 26 years. It could be solvent for the next century if we raised the ceiling on income subject to the Social Security payroll tax. That ceiling is now $106,800.
7. It’s unfair that lower-income Americans don’t pay income tax.
Wrong. There’s nothing unfair about it. Lower-income Americans pay out a larger share of their paychecks in payroll taxes, sales taxes, user fees, and tolls than everyone else.
Demagogues through history have known that big lies, repeated often enough, start being believed — unless they’re rebutted. These seven economic whoppers are just plain wrong. Make sure you know the truth – and spread it on.

Mercedes Lackey
Mercedes Lackey6 years ago

Part Two:

4. Cutting the budget deficit now is more important than boosting the economy.
Untrue. With so many Americans out of work, budget cuts now will shrink the economy. They’ll increase unemployment and reduce tax revenues. That will worsen the ratio of the debt to the total economy. The first priority must be getting jobs and growth back by boosting the economy. Only then, when jobs and growth are returning vigorously, should we turn to cutting the deficit.
5. Medicare and Medicaid are the major drivers of budget deficits.
Wrong. Medicare and Medicaid spending is rising quickly, to be sure. But that’s because the nation’s health-care costs are rising so fast. One of the best ways of slowing these costs is to use Medicare and Medicaid’s bargaining power over drug companies and hospitals to reduce costs, and to move from a fee-for-service system to a fee-for-healthy outcomes system. And since Medicare has far lower administrative costs than private health insurers, we should make Medicare available to everyone.
6. Social Security is a Ponzi scheme.
Don’t believe it. Social Security is solvent for the next 26 years. It could be solvent for the next century if we raised the ceiling on income subject to the Social Security payroll tax. That ceiling is now $106,800.

Thomas A.
Thomas A6 years ago

The Recession ended? When? I'm sick of this callous language the economists and ruling 1% use to conceal their sins. This is a Depression. It doesn't look exactly like the Great Depression because of the laws and programs that were created to prevent the same level of devastation. But it's still a depression. And we're not out of it. It doesn't matter what level the DOW is at.

Saying that it's *only* a recession, and then that it ended, is a cruel slap in the face to the 16.5 million Americans currently willing to work but still have no jobs.

I know, I know, they like to hide behind their cute little clean-cut definitions, based on level of GDP and unemployment rate, etc., but tell that to the 16.5 million. Tell that to the additional 25 million that are stuck with part-time work instead of full-time jobs with benefits. Tell that to the 40 million Americans whose employers dropped their health insurance and, obviously, they can't afford any on their own. Tell that to all of us whose incomes have not kept up with inflation over the last decade, never mind the last 4 years!

Sick American shit. I'm embarrassed and ashamed. I have to look to the Occupy Wall St. movement to find hope in our future.

Three more "free trade" agreements crafted by the Obama administration were just passed. There goes a few million more jobs overseas. Thanks, Obama, we deeply appreciate that.

Mercedes Lackey
Mercedes Lackey6 years ago

Robert Reich: Leading Economist Busts Lies: Part One

1. Tax cuts for the rich trickle down to everyone else.
Baloney. Ronald Reagan and George W. Bush both sliced taxes on the rich and what happened? Most Americans’ wages (measured by the real median wage) began flattening under Reagan and has dropped since George W. Bush. Trickle-down economics is a cruel joke.
2. Higher taxes on the rich would hurt the economy and slow job growth.
False. From the end of World War II until 1981, the richest Americans faced a top marginal tax rate of 70 percent or above. Under Dwight Eisenhower it was 91 percent. Even after all deductions and credits, the top taxes on the very rich were far higher than they’ve been since. Yet the economy grew faster during those years than it has since. (Don’t believe small businesses would be hurt by a higher marginal tax; fewer than 2 percent of small business owners are in the highest tax bracket.)
3. Shrinking government generates more jobs.
Wrong again. It means fewer government workers – everyone from teachers, fire fighters, police officers, and social workers at the state and local levels to safety inspectors and military personnel at the federal. And fewer government contractors, who would employ fewer private-sector workers. According to Moody’s economist Mark Zandi (a campaign advisor to John McCain), the $61 billion in spending cuts proposed by the House GOP will cost the economy 700,000 jobs this year and next.

Donna Hamilton
Donna Hamilton6 years ago

The worst is yet to come, I'm sorry to say.