Although the unemployment rate
is down, you could say we have the most well-educated bartenders and busboys in
history. The World Economic Forum found that most college-educated workers took
jobs in low-earning industries between 2000 and 2014, and wages of young
college graduates are 2.5 percent lower than they were in 2000.
This has an impact on more than
just graduates and the parents they may be moving back in with. Unemployed and
underemployed people spend less on consumables. In turn, low demand for goods
and services leads to lower growth, and companies that aren’t growing don’t
create more jobs.
As a whole, the nation’s
unemployment rate dropped to 5.1 percent in August, but it was at 7.2 percent
for recent college graduates and 19.5 percent for those fresh out of high
school. This means that more than a quarter of this teenage generation is
unable to buy a new car, house or other perks that come with being in the job
market.
[CLICK HERE
to read the article, “Why college-educated workers are taking low-paid jobs,” from
World Economic Forum, Sept. 4, 2015.]
[CLICK HERE
to read the report, “The Class of 2015: Despite an Improving Economy, Young
Grads Still Face an Uphill Climb,” from Economic Policy Institute; May 27,
2015.]
All of this is just part of the
reason the Federal Reserve’s Open Market Committee decided against raising
interest rates in September -- also citing global issues and their impact on
the U.S. stock market.
Please contact us if you wish
to discuss how this may impact your current financial strategy.
[CLICK HERE
to read the media release, “Regional and State Employment and Unemployment
Summary,” from Bureau of Labor Statistics, Sept. 18, 2015.]
The lack of jobs and a stalemate in the real estate market have
contributed to slow recovery in many areas of the country. Six years after the
recession ended, many cities in the Southwest have the lowest recovery rates based
on 17 economic indicators, such as home-price appreciation and wage growth. Nine
of the 15 cities in the worst shape are located in Arizona and Nevada.
[CLICK HERE
to read the article, “Cities in the Southwest Are Still Waiting for a Recovery,”
from The Wall Street Journal, Sept. 18, 2015.]
[CLICK HERE
to read the article, “2015’s Most & Least Recession-Recovered Cities,” from
WalletHub, Sept. 14, 2015.]
As you might have guessed, those faring best in the post-recovery
stage are people who already possessed a substantial amount of wealth. Earnings
have increased among households ranked in the 90th and 95th
percentiles of wealth in the U.S. since the recession, but on average, income
levels for all other groups are still below 2006 levels. Today, the median
household income is 6.5 percent lower than it was in 2007, the year the
recession started.
[CLICK HERE
to read the article, “The Richest Americans Are Winning the Economic Recovery,”
from Bloomberg, Sept. 16, 2015.]
One of the best lessons we can extract from the recession is that
we can’t control what will happen with the economy, but we can be proactive
about what we do with our assets. Regardless of where you stand in the recovery
spectrum, please give us a call to discuss potential strategies for positioning
your assets that can help ensure your family’s financial future.
We are an independent firm helping individuals
create retirement strategies using a variety of insurance products to custom
suit their needs and objectives.
The information contained in this material is
provided by third parties and has been obtained from sources believed to be
reliable, but accuracy and completeness cannot be guaranteed; it is not
intended to be used as the sole basis for financial decisions.
If you are unable to access any of the news
articles and sources through the links provided in this text, please contact us
to request a copy of the desired reference.
AE10155167