Job growth surged last month in the United States, but not all Americans are feeling the benefits. The unemployment rate is below 5 percent in the U.S., but according to a recent study on consumer spending, around one in five Americans struggle to buy basic necessities.
CCTV America’s William Denselow reports. Follow William Denselow on Twitter @willdenze
Study finds most Americans have less to spend on themselvesAccording to research by America's Research Group, around 20 percent of workers struggle to earn enough to have cash leftover to spend. CCTV America's William Denselow reports.
New York is one of the shopping capitals of the world. But some retailers’ doors aren’t open to everyone.
Janika Reyes, retail worker, said he hopes to forge a career in the retail sector, but has faced barriers along the way. Having worked multiple jobs in the city, she’s earned between $300 to $1,500 a month.
“You get your check and at least 75 percent of it is just gone and you’re probably left with about $100 just to be able to get yourself, to get to work and come back,” Reyes said.
Janika isn’t alone. According to research by America’s Research Group, around 20 percent of workers struggle to earn enough to have cash leftover to spend.
“Most of them have two or three jobs,” Britt Beemer, chairman and founder of America’s Research Group, said. “Most of them have an income around 26, 27 or maybe $28,000. Almost all of them are single parents with two or three kids at home. They still want to work, they don’t want to go on welfare.”
This week, the Federal Reserve said the U.S. labor market has strengthened. The unemployment rate stands at just under 5 percent.
While that’s good news for the economy, concerns remain that it is not translating to better wages for many Americans who are still feeling the effects of the global financial crisis six years ago.
“There is a deeper long-term trend we see in a number of countries but particularly in the U.S., and that’s rising inequality,” Joe Foudy, professor at the New York University Stern School of Business, said. “The U.S. economy has grown significantly since 2008, but median wages are stagnating, while a lot of other people’s costs are going up.”
With consumer spending accounting for about two-thirds of the U.S. economy, the concern is a lack of spending could weigh on future economic growth.
In the U.S., there are some signs that wages are finally on the rise. But for many workers here in New York, they believe a higher minimum wage will be the most effective way to restore confidence and get people spending again.