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Brown's situation is a common one. Per capita income, after taxes, now stands at $34,725 a year nationwide, according to the Bureau of Economic Analysis. But in inflation-adjusted terms, that's just $8 higher than it was last fall.
Little wonder that as energy costs have soared, Americans have started conserving fuel and cutting back on other expenses.
- Talk back: Who handles the family finances?
The weakness in the labor market comes in the form of underemployment as well as unemployment. The jobless rate jumped half a percentage point to 5.5% in May, its sharpest one-month increase in 22 years, intensifying pressure on consumers who already face a housing slump and soaring gasoline prices.
Labor markets are key to the economic outlook. May's rise in the unemployment rate was the biggest since February 1986. The number of Americans losing their jobs has increased in each of the first five months of this year, but there's been a bigger rise in the percentage of people who work less than they want to.
An alternative measure of the jobless rate, also provided by the Labor Department, includes "discouraged" people who would like to find a job but aren't actively looking, and those who want full-time work but have part-time jobs. By that gauge, unemployment and underemployment through April had risen from 8.2% of the labor force a year ago to 9.2%. The April numbers saw a big jump in the number of workers in the part-time predicament.
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For many Americans, mortgages are just part of a debt load that's been rising in recent years.
According to a recent survey sponsored by Securian Financial Group, large numbers of consumers are carrying balances on their credit cards. Nearly half of baby boomers in the survey were doing so, for example.
And 47% of survey respondents in the younger Generation Y had student loans, up from 30% of Generation X respondents.
But home loans have been the biggest form of debt. In recent years, mortgage debt has been rising faster than home values, and lately, home prices have been falling.
One result: a rise in the number of mortgages past due or in foreclosure. New numbers from the Mortgage Bankers Association show that 8.8% of American home loans were past due or in foreclosure at the end of March, making the first quarter of 2008 the worst three-month period for homeowners in nearly 25 years.
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Will we dodge a recession?Consecutive quarters of negative growth is the standard definition, and the economy grew last quarter. More recent data offer reasons for optimism, and pessimism.
According to a Federal Reserve report released June 5, the overall net worth of America's households fell for a second straight quarter during the year's first three months. The value of both financial assets and home equity fell, while the amount of home-mortgage debt rose.
That's a recipe for a slow economy at best, and possibly for a sharp consumer slowdown.
This article was reported and written by Mark Trumbull for The Christian Science Monitor.
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