Millions of Americans continue to be trapped in a cycle of debt and financial insecurity, a new report says.
Has the U.S. economy recovered? Some of the key indicators, including improvements in the housing market, unemployment and stocks, point to yes. Even so, many Americans are looking at their lives and asking, “What economic recovery?”
A new report, released by the Corporation for Enterprise Development, found that millions of Americans have essentially been bypassed by the economic recovery in the United States.
“Not only are these households not reaping benefits of an improving economy, they are living outside the economic mainstream, relegated to using fringe — often high-cost — financial services and products that trap them in a cycle of debt and financial insecurity,” the report said.
The CFED report summarizes the findings from its 2015 Assets and Opportunity Scorecard, which includes state-by-state assessments. It highlights these five issues:
- Financial assets and income. About 44 percent of U.S. families live in liquid-asset poverty. In addition, when it comes to income inequality, “those in the bottom quintile earned one-fifth the income earned at the top quintile ($21,159, compared with $106,196),” the report said. The result, it says, is that many Americans resort to taking out high-interest, predatory loans to make ends meet.
- Businesses and jobs. According to the CFED, 25 percent of available jobs in the country are low paying, an increase of 4 percent from last year. Women and workers of color hold a disproportionate number of low-income jobs. Meanwhile, the report says that average annual pay across the board continued nearly a decade of stagnation and actually fell between 2012 ($50,011) and 2013 ($49,808).”