by Michael Snyder, The Economic Collapse Blog:
If you are wondering why so many Americans are stressed about their finances these days, just look at the numbers. The Social Security Administration just released national wage statistics for 2022, and the figures that they have given us do not paint a pretty picture at all. In particular, we should all be deeply alarmed that the median wage earner brought home just $40,847.18 last year. That breaks down to about $3,400 a month, and that is before taxes. Needless to say, you cannot live a middle class lifestyle in America today on just $3,400 a month before taxes. So in most households more than one person must work, and in many cases more than one person is working multiple jobs.
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During our current inflation crisis, the cost of living has been rising much faster than paychecks have, and this is squeezing American families like never before.
Right now, the national median price of renting a home is $1,978 a month, and so after paying rent on a home the average worker wouldn’t have much left over for anything else.
Meanwhile, actually owning a home is the most unaffordable that it has been since 1984…
Buying and paying for a house costs Americans more now than at any point in almost four decades. Thanks to strong demand and a limited supply of new homes – even as mortgage rates have more than doubled in the past year – it now takes nearly 41% of the median household’s monthly income to afford the payments on a median-priced home, according to research from Intercontinental Exchange (ICE). The last time housing payments cost that much was in 1984.
Of course it isn’t just the cost of housing that has gone crazy.
Just about everything has soared in price over the past few years, and those at the bottom of the economic food chain are being hit the hardest…
But when compared with January 2021, shortly before the inflation crisis began, prices remain up a stunning 17.62%.
Inflation has created severe financial pressures for most U.S. households, which are forced to pay more for everyday necessities like food and rent. The burden is disproportionately borne by low-income Americans, whose already-stretched paychecks are heavily impacted by price fluctuations.
If things are hard for you and your family right now, please understand that you are not alone.
Most of the country is in the exact same boat.
In a desperate attempt to maintain their middle class lifestyles, millions upon millions of Americans have been taking on debt like never before, and as a result we are now facing an unprecedented consumer debt bubble…
Inflation has also impacted spending on major purchases. Balances on non-housing loans have more than doubled since 2003, totaling roughly $4.8 trillion, according to data from the New York Federal Reserve. More than $500 billion of that debt accumulated just in the past two years – a bigger jump than any other two-year period since 2003, the earliest year available.
Some of that debt comes from skyrocketing car prices, but credit card balances are growing the fastest of all – roughly 34% from the fall of 2021.
Unfortunately, the consumer debt party is coming to an end because financial institutions are starting to become significantly tighter with their money.
A credit crunch has begun, and it is only going to intensify in the months ahead.
Of course that is more bad news for our rapidly shrinking middle class.
More formerly middle class Americans are falling into poverty with each passing day, and this is causing an alarming surge in demand at food banks from coast to coast…
As families across the nation prepare for the holiday season, some food banks across the United States dedicated to fighting hunger say they are experiencing an increase in demand following the end of pandemic-era SNAP benefits, an increase in inflation, and other regional factors.
Caroline De La Fuente helps care for her 16 grandchildren while their parents work to make ends meet and is one of the thousands of people who, according to data, depend on food banks. She told ABC News that without the San Antonio Food Bank, her family and others in the community wouldn’t eat.
“A lot of people would go hungry,” she said. “Kids would go hungry at night. People would not be able to celebrate Thanksgiving.”
The number of homeless Americans is spiking as well.
In fact, the Wall Street Journal has reported that homelessness in the United States has been increasing at the fastest pace ever recorded in 2023….
The U.S. has seen a record increase in homeless people this year as the Covid-19 pandemic fades, according to a Wall Street Journal review of data from around the country.
Yes, this is really happening.
The middle class really is coming apart at the seams right in front of our eyes.
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