America's working poor stretching paychecks to the breaking point

[Praetorian]

America's working poor stretching paychecks to the breaking point

By Anne D'innocenzio
ASSOCIATED PRESS

10:46 a.m. October 19, 2007

NEW YORK – The calculus of living paycheck to paycheck in America is getting harder.

What used to last four days might last half that long now. Pay the gas bill, but skip breakfast. Eat less for lunch so the kids can have a healthy dinner.

Across the nation, Americans are increasingly unable to stretch their dollars to the next payday as they juggle higher rent, food and energy bills. It's starting to affect middle-income working families as well as the poor, and has reached the point of affecting day-to-day calculations of merchants like Wal-Mart Stores Inc., 7-Eleven Inc. and Family Dollar Stores Inc.

Food pantries, which distribute foodstuffs to the needy, are reporting severe shortages and reduced government funding at the very time that they are seeing a surge of new people seeking their help.

While economists debate whether the country is headed for a recession, some say the financial stress is already the worst since the last downturn at the start of this decade.

From Family Dollar to Wal-Mart, merchants have adjusted their product mix and pricing accordingly. Sales data show a marked and more prolonged drop in spending in the days before shoppers get their paychecks, when they buy only the barest essentials before splurging around payday.

“It's pretty pronounced,” said Kiley Rawlins, a spokeswoman at Family Dollar. “It seems like to us, customers are running out of food products, paper towels sooner in the month.”

Wal-Mart, the world's largest retailer, said the imbalance in spending before and after payday in July was the biggest it has ever seen, though the drop-off wasn't as steep in August.

And 7-Eleven says its grocery sales have jumped 12-13 percent over the past year, compared with only slight increases for non-necessities like gloves and toys. Shoppers can't afford to load up at the supermarket and are going to the most convenient places to buy emergency food items like milk and eggs.

“It even costs more to get the basics like soap and laundry detergent,” said Michelle Grassia, who lives with her husband and three teenage children in the Bedford-Stuyvesant section of Brooklyn, N.Y.

Her husband's check from his job at a grocery store used to last four days. “Now, it lasts only two,” she said.

To make up the difference, Grassia buys one gallon of milk a week instead of three. She sometimes skips breakfast and lunch to make sure there's enough food for her children. She cooks with a hot plate because gas is too expensive. And she depends more than ever on the bags of free vegetables and powdered milk from a local food pantry.

Grassia's story is neither new nor unique. With the fastest-rising food and energy prices since the 1980s, low-income consumers are stretching their budgets by eating cheap foods like peanut butter and pasta.

Industry analysts and some economists fear the strain will get worse as people are hit with higher home heating bills this winter and mortgage rates go up.

It's bad enough already for 85-year-old Dominica Hoffman.

She gets $1,400 a month in pension and Social Security from her days in the garment industry. After paying $500 in rent on an apartment in Pennsauken, N.J., and shelling out money for food, gas and other expenses, she's broke by the end of the month. She's had to cut fruits and vegetables from her grocery order – and that's even with financial help from her children.

“Everything is up,” she said.

Many consumers, particularly those making less than $30,000 a year, are cutting spending on nutritious food like milk and vegetables, and analysts fear they're further skimping on basic medical care and other critical services.

Coupon-clipping just isn't enough.

“The reality of hunger is right here,” said the Rev. Melony Samuels, director of The BedStuy Campaign against Hunger, a church-affiliated food pantry in Brooklyn.

The pantry scrambled to feed 5,000 new families over the past 12 months, up almost 70 percent from 3,000 the year before.

“I am shocked to see such numbers,” Samuels said, “and I am really concerned that this is just the beginning of what we are going to see.”

In the past three months, Samuels has seen more clients in higher-paying jobs – the $35,000 range – line up for food as the fallout of the subprime mortgage woes takes hold.

The Regional Food Bank of Northeastern New York, which covers 23 counties in New York State, cited a 30 percent rise in visitors in the first nine months of this year, compared with 2006.

Maureen Schnellmann, senior director of food and nutrition programs at the American Red Cross Food Pantry in Boston, reported a 30 percent increase from January through August over last year.

Until a few months ago, Dellria Seales, a home care assistant, was just getting by living with her daughter, a hairdresser, and two grandchildren in a one-bedroom apartment for $750 a month. But a knee injury in January forced her to quit her job, leaving her at the mercy of Samuels' pantry because most of her daughter's $1,200 a month income goes to rent, energy and food costs.

“I need it. Without it, we wouldn't survive,” Seales said as she picked up carrots and bananas.

John Vogel, a professor at Dartmouth College's Tuck School of Business, worries that the squeeze will lead to a less nutritious diet and inadequate medical or child care.

In the meantime, rising costs show no signs of abating.

Gas prices hit a record nationwide average of $3.23 per gallon in late May before receding a little, though prices are expected to soar again later this year. Food costs have increased 4.5 percent over the past 12 months, partly because of higher fuel costs. Egg prices were 44 percent higher, while milk was up 21.3 percent over the past 12 months to nearly $4 a gallon, according to the Bureau of labour Statistics.

The average family of four is spending anywhere from $7 to $10 extra a week – $40 more a month – on groceries alone, compared to a year ago, according to retail consultant Burt Flickinger III.

And while overall wage growth is a solid 4.1 percent over the past 12 months, economists say the increases are mostly for the top earners.

Retailers started noticing the strain in late spring and early summer as they were monitoring the spending around the paycheck cycle.

Wal-Mart and Family Dollar key on the first week of the month, when government checks like Social Security and public assistance generally hit consumers' mailboxes.

7-Eleven, whose customers are more diverse, looks at paycheck cycles in specific markets dominated by a major employer, such as General Motors in Detroit, to discern trends in shopping.

To economize, shoppers are going for less expensive food.

“They're buying more peanut butter and pasta. And they're going for hamburger meat,” Flickinger, the retail consultant, said. “They're trying to outsmart the store by looking for deep discounts at the end of the month.”

He said the last time he saw this was 2000-2001, when the dot-com bubble burst and the economy went into a recession after massive layoffs.

For now, low-price retailers are readjusting their merchandising and pricing.

Wal-Mart is becoming more aggressive on discounting. It announced Thursday it is expanding price cuts to 15,000 items, ranging from Motts apple juice and Progresso soups to women's fleece tops, heading into the holidays.

Family Dollar, whose food offerings were limited to candy and snacks until two years ago, has expanded its mix of groceries like fruit cups, cereal and such refrigerated items as milk and ice cream while cutting back on shoes. This summer the chain began accepting food stamps.

Food pantries are also getting creative. Samuels said her church, Full Gospel Tabernacle of Faith, just started offering free cooking classes to teach clients who are diabetic or have other health conditions how to prepare vegetables like squash. It's also offering free exercise classes.

“We are trying to make them health conscious,” Samuels said. “It's not right to give them just anything. Our mantra is eat well and live well.”

Liberalism is good for you?

[AdrianHealey]

Danku overheid, zeggen we dan.

[Percalion]

Boh, Associated Press, iedereen weet toch dat die even "objectief" zijn als Reuters en de staatsmedia, kom zeg.

[Praetorian]

January 16, 2008
Blue-Collar Jobs Disappear, Taking Families’ Way of Life Along
By ERIK ECKHOLM
JACKSON, Ohio — After 30 years at a factory making truck parts, Jeffrey Evans was earning $14.55 an hour in what he called “one of the better-paying jobs in the area.”

Wearing a Harley-Davidson cap, a bittersweet reminder of crushed dreams, he recently described how astonished and betrayed he felt when the plant was shut down in August after a labor dispute. Despite sporadic construction work, Mr. Evans has seen his income reduced by half.

So he was astonished yet again to find himself, at age 49, selling off his cherished Harley and most of his apartment furniture and moving in with his mother.

Middle-aged men moving in with parents, wives taking two jobs, veteran workers taking overnight shifts at half their former pay, families moving West — these are signs of the turmoil and stresses emerging in the little towns and backwoods mobile homes of southeast Ohio, where dozens of factories and several coal mines have closed over the last decade, and small businesses are giving way to big-box retailers and fast-food outlets.

Here, where the northern swells of the Appalachians lap the southern fringe of the Rust Belt, thousands of people who long had tough but sustainable lives are being wrenched into the working poor.

The region presents an acute example of trends affecting many parts of Ohio, Michigan and other pockets of the Midwest.

Slammed by the continued decline in the automobile and steel businesses, Ohio never recovered from the recession of 2001-2, and blue-collar families who had made it partway up the economic ladder find themselves slipping back, with chaotic effects on families and dreams.

Throughout the state, the percentage of families living below the poverty line — just over $20,000 for a family of four last year — rose slightly from 14 percent in 2005 to 16 percent in 2007, one study found. But equally striking is the rise in younger working families struggling above that line. The numbers are more dismal in the southeastern Appalachian part of the state, where 32 percent of families lived below the poverty line in 2007, according to the study, and 56 percent lived with incomes less than $40,000 for a family of four.

“These younger workers should be the backbone of the economy,” said Shiloh Turner, study director for the Health Foundation of Greater Cincinnati, which conducted the surveys. But in parts of Ohio, Ms. Turner said, half or more “are barely making ends meet.”

One consequence is an upending of the traditional pattern, in which middle-aged children take in an elderly parent. As $15-an-hour factory jobs are replaced by $7- or $8-an-hour retail jobs, more men in their 30s and 40s are moving in with their parents or grandparents, said Cheryl Thiessen, the director of Jackson/Vinton Community Action, which runs medical, fuel and other aid programs in Jackson and Vinton Counties.

Other unemployed or low-wage workers, some with families, find themselves staying with one relative after another, Ms. Thiessen said, serially wearing out their welcome.

“A lot of major employers have left, and the town is drying up,” Ms. Thiessen said of Jackson. “We’re starting to lose small shops, too — Hallmark, the jewelry and shoe stores, the movie theater and most of the grocery stores.”

Shari Joos, 45, a married mother of four boys in nearby Wellston, said, “If you don’t work at Wal-Mart, the only job you can get around here is in fast food.”

Between her husband’s factory job and her intermittent work, they made $30,000 a year in the best of times, Mrs. Joos said. Since last fall, when her husband was laid off by the Merillat cabinet factory, which downsized to one shift a day from three, keeping anywhere near that income required Mrs. Joos to take a second job. She works at a school cafeteria each weekday from 9:30 a.m. to 1 p.m and then drives to Wal-Mart, where she relaxes in her car before starting her 2-to-10 p.m. shift at the deli counter.

Her 20-year-old son went to college for two years, earning an associate degree in information science, but cannot find any jobs nearby. He still works at McDonald’s and lives at home as he ponders whether to move to a distant city, as most local college graduates must. Her 22-year-old son works at Burger King and lives with his grandparents — “that was his way of moving out,” Mrs. Joos said.

In late December her husband landed a new job, driving a fork lift at a Wal-Mart distribution center, a shift that ends at 2:30 a.m. It pays a little less than he used to make and is an hour’s drive away, so gasoline soaks up a painful share of his wages.

“We never see each other,” Mrs. Joos, 45, said on a recent morning as she packed a roast beef and cheese sandwich for her evening meal. “We never even think of taking a vacation.”

Luckily they had paid off their mobile home and an addition they built.

As experienced men in this corner of Ohio have found themselves working for lower wages, others feel they must move.

“I’m ain’t going to work for no $8 an hour!” said Lindsey Webb, 52, who, like Mr. Evans, was one of hundreds laid off when Meridian Automotive Systems closed its local plant. On a recent night, Mr. Webb was helping out in a trailer in front of the old factory, a vigil by the United Steelworkers Union to remind the company of its obligations to former workers.

Mr. Webb, who worked at the plant for 33 years, made more than $16 an hour doing machine maintenance. Now he is thinking of moving to Arizona, taking along his elderly father, whom he helps care for.

Darrel McKenzie, 44, was also a maintenance man at Meridian and grossed more than $60,000 a year. Now he has restarted at the bottom as a union pipe-fitting apprentice and expects to make $20,000 this year. His family just “does less,” Mr. McKenzie said.

Mr. Evans said that moving back into the home where he grew up, after decades of independence, was a stinging reminder that “I lost everything I worked for all my life.”

His mother, Shirley Sheline, 73, had worked 28 years at the same auto parts plant, and shares his dismay. “Can you believe it, a grown man forced to move back with his mother,” she said.

Seeing his desperation last year, she added a room to her house with a separate door.

“I don’t know what I’d have done without my mom,” Mr. Evans said. “At least I can help her, or if I get back on my feet, she can rent it out.”

By contrast, selling his Harley, which he would have paid off this year, was pure torture. He had owned a Harley since he was 20, and weekend cruising with pals was his favorite recreation.

“The buyer said he wanted to take it away in the back of a trailer,” Mr. Evans recalled, “and I said, ‘That won’t happen.’ ”

“Instead I drove it to his house, threw him the keys, came home and got drunk.”

http://www.nytimes.com/2008/01/16/us...VqfOhOCmjcDrug

[guerin]

Oorspronkelijk geplaatst door AdrianHealey

Danku overheid, zeggen we dan.

Dank u overheid om te voorkomen dat the poor de winkel zou plunderen?

De staat is altijd in dienst van het kapitaal.

[the_dude]

zolang types die meer dan 50 000 $ / jaar verdienen niet inzien dat zij misdadige elementen zijn zal de boel blijven verslechteren.

[Praetorian]

Oorspronkelijk geplaatst door the_dude

zolang types die meer dan 50 000 $ / jaar verdienen niet inzien dat zij misdadige elementen zijn zal de boel blijven verslechteren.

Ik denk dat er bij de blue collar workers toch een herontdekking van de erfenis van Roosevelt zal ontstaan. De evidentie van een herverdeling van de welvaart om iedereen een menswaardig bestaan te geven kan ook in de VS aanslaan.

[AdrianHealey]

Soit, protectionisme meets geldcreatie equals poor people.

Ahnee, wacht, de overheid is het grote land der welvaart en kapitalisme zeker?

[jamás será vencido]

Oorspronkelijk geplaatst door AdrianHealey

Soit, protectionisme meets geldcreatie equals poor people.

Ahnee, wacht, de overheid is het grote land der welvaart en kapitalisme zeker?

neen, de werknemers zijn dat.

[sancho]

Oorspronkelijk geplaatst door Praetorian

Ik denk dat er bij de blue collar workers toch een herontdekking van de erfenis van Roosevelt zal ontstaan. De evidentie van een herverdeling van de welvaart om iedereen een menswaardig bestaan te geven kan ook in de VS aanslaan.

Voor mij is dat geen evidentie.

[Casca]

Oorspronkelijk geplaatst door guerin

Dank u overheid om te voorkomen dat the poor de winkel zou plunderen?

De staat is altijd in dienst van het kapitaal.

'De winkel plunderen' kan wel tellen als productieve oplossing.

[Pelgrim]

dat is anders de uiterste consequentie van het liberalisme.

[Casca]

Wel al lang aan het wachten op die uiterste consequentie he?

[Pelgrim]

leve de sociale zekerheid en de welvaartstaat

[lombas]

Ik eet zelden ontbijt en lunch.

[Desiderius]

Er is iets wat ik niet geheel snap: de cost of living is in de VS een stuk (vaak een héél stuk) lager dan in EU. En toch blijkt het een drama te zijn om op vergelijkbare inkomens rond te komen. Zou het kunnen zijn dat die 'working poor' 's avonds in breedbeeld en HD-kwaliteit naar hun dinner zittel te kijken? Of de lunch van hun kindertjes erdoor jagen met hun 4x4 pickups? (nogal veel referentie naar gas prices) Amerikanen zijn notoire kredietnemers; hebben de neiging om constant op het randje van de financiële afgrond te leven om toch maar die plasma-teevee en die auto('s) op de driveway te hebben staan. Dat ligt iets anders bij de gemiddelde Europeaan. Wij hebben overigens ook andere prioriteiten. Mijn grootva zou nog eerder met een gat in z'n broek rondgelopen hebben dan met een hongergevoel.

Not everything is what it seems...
Lange teksten, maar als je de moeite neemt om ze te lezen dan merk je vanzelf wel dat die klaagzang voor een héél groot stuk zo onoprecht is als de pest.


oh ja, info over de cost of living: Hou 'm in je bookmarks, nuttige link imo.

Moskou is al tweede jaar op rij de duurste stad.

[Geert C]

Over een gerelateerd onderwerp: ik heb vandaag gehoord dat de Britse levensstandaard voor het eerst de Amerikaanse heeft voorbijgestoken.

Is er hier iemand die kan bevestigen of dat klopt?

[vlijmscherp]

Oorspronkelijk geplaatst door Desiderius

Er is iets wat ik niet geheel snap: de cost of living is in de VS een stuk (vaak een héél stuk) lager dan in EU. En toch blijkt het een drama te zijn om op vergelijkbare inkomens rond te komen. Zou het kunnen zijn dat die 'working poor' 's avonds in breedbeeld en HD-kwaliteit naar hun dinner zittel te kijken? Of de lunch van hun kindertjes erdoor jagen met hun 4x4 pickups? (nogal veel referentie naar gas prices) Amerikanen zijn notoire kredietnemers; hebben de neiging om constant op het randje van de financiële afgrond te leven om toch maar die plasma-teevee en die auto('s) op de driveway te hebben staan. Dat ligt iets anders bij de gemiddelde Europeaan. Wij hebben overigens ook andere prioriteiten. Mijn grootva zou nog eerder met een gat in z'n broek rondgelopen hebben dan met een hongergevoel.

Not everything is what it seems...
Lange teksten, maar als je de moeite neemt om ze te lezen dan merk je vanzelf wel dat die klaagzang voor een héél groot stuk zo onoprecht is als de pest.


oh ja, info over de cost of living: Hou 'm in je bookmarks, nuttige link imo.

Moskou is al tweede jaar op rij de duurste stad.

er zullen er zeker bij zijn die liever een duurdere TV kopen dan wat meer eten, maar dat maakt niet weg dat er veel meer zijn die een Mc-Donaldsjobke hebben en in een trailer wonen.