From the start of the recession in 2007 to today, the average price of the things you buy – clothes, food, housing – has risen by 15 percent. This, in itself, isn’t a problem at all. The problem is that wages haven’t kept pace with that increase. In fact, for all but the top wage earners, real (inflation-adjusted) earnings are actually down over the same period.
Let’s put it another way. Say that you’re a median wage earner, right in the 50th percentile. And let’s say that in 2007 you could buy a week’s worth of groceries for $100. Fast forward to today: those exact same groceries cost $115, but you only have $112 dollars in your pocket.
These figures are from a recent Economic Policy Institute report on our mediocre wage growth (for a great summary of the whole thing, check out Jonnelle Marte’s take over at her new blog, Get There). And they provide important context for a new Rutgers University poll released today, showing increasing pessimism in the aftermath of the Great Recession.
Most strikingly, seven in ten Americans now say the recession has done permanent damage to the American economy. In 2009, at the start of the recovery, only 49 percent of Americans said the same.
One simple reason why pessimism has risen throughout the “recovery” is that over the same period, wages have not. According to the Rutgers poll, 57 percent of Americans say they have less or the same amount of earnings and savings now as they did five years ago. Nearly six in ten describe their financial situation negatively.
Senior Director, Coldwell Banker New Homes Division
With over 200 condominium, townhome and loft projects successfully marketed
“Fewer properties for sale with such remarkably low interest rates make it a great time to sell but a more difficult time to buy”