A Legacy of ?Falling Behind?

Middle Class Shrinks, Manufacturing Struggles, Paychecks Stagnate
"Americans are less optimistic about how well the economy will fare over the next year than they were last January. . . . For those in households earning $30,000 or less annually, the feeling of falling behind financially is widespread. Fully 68% of lower-income households think their family's income is falling behind the cost of living . . . . A majority of those with incomes of $30,000 to $75,000 (54%) also say they are falling behind financially." ("As Election Year Nears, Public Sees Mixed Economic Picture," Pew Research Center, 12/22/2015)

Economic Reality: 'The Middle Class Is No Longer The Majority In America'
PRES. OBAMA: "Stronger families.  Stronger communities.  A stronger America.  It is this kind of prosperity -- broad, shared, built on a thriving middle class -- that has always been the source of our progress at home." (President Obama, State Of The Union Address, 2/12/2013)

"The middle class is no longer the majority in America." ("America's Middle Class Is No Longer the Majority," The Wall Street Journal, 12/09/2015)

• "The nation's middle class, long a pillar of the U.S. economy and foundation of the American dream, has shrunk to the point where it no longer constitutes the majority of the adult population, according to a new major study." ("Middle-Class Families, Pillar Of The American Dream, Are No Longer In The Majority, Study Finds," Los Angeles Times, 12/09/2015)
  
• "The decline of the middle class has been accompanied by growing inequality . . . ." ("Income Inequality Has Squeezed The Middle Class Out Of The Majority, Washington Post's Wonkblog, 12/09/2015)

"[A]s 2016 begins, the stout job market is accompanied by tepid economic growth and stubbornly flat wages. . . . [A]verage hourly pay seems stuck, sliding one cent last month to $25.24. That left the growth of average pay at 2.5 percent last year, below the 3.5 percent economists consider healthy." ("A Mixed State Of The Union In 2016: Middling Economic Growth, Strong Year For Jobs, Gun Makers," The Associated Press, 1/11/2016)

"A long-missing ingredient during the expansion has been stronger wage growth, signaling continued slack in the labor market. . . . One factor holding wages in check is a potential supply of workers outside of the labor market. The labor force grew by nearly a half-million people in December, a factor that helped hold the unemployment rate at 5% despite strong hiring." ("Hiring Ends Year on Strong Note, but Wage Growth Remains Sluggish," The Wall Street Journal, 1/08/2016)

"A broader measure of unemployment that includes Americans stuck in part-time jobs or too discouraged to look for work stayed at 9.9% in December and has been virtually unchanged since September." ("Hiring Ends Year on Strong Note, but Wage Growth Remains Sluggish," The Wall Street Journal, 1/08/2016)

Key Economic Sectors StrugglingPRES. OBAMA: "Our first priority is making America a magnet for new jobs and manufacturing." (President Obama, State Of The Union Address, 2/12/2013)

Manufacturing"Manufacturing was one of the worst performing job sectors in the economy in 2015." ("U.S. manufacturing index at worst level since 2009," CNNMoney, 1/04/2016)

• "America's manufacturing sector shrank for the second straight month in December. The industry's key index -- ISM -- hit 48.2% in December, the lowest mark since June 2009. Anything below 50% is a contraction and a month ago it hit 48.6%. The index has fallen for six straight months." ("U.S. manufacturing index at worst level since 2009," CNNMoney, 1/04/2016)

National Association of Manufacturers' Outlook Survey: "For much of this year, manufacturers have wrestled with softer growth in demand and output. . . . This slowdown can be seen in a variety of economic indicators. Manufacturing production has decelerated from 4.3 percent on a year-over-year basis in January to 1.9 percent in October, with employment remaining relatively flat over that time frame. . . .  Other measures have also eased significantly across the year. For instance, manufacturers expect sales to grow 1.4 percent over the next 12 months, down significantly from the 4.5 percent pace in December 2014." (NAM Manufacturers' Outlook Survey – Fourth Quarter, 12/2015)

• "Anxieties in the economic outlook also weighed heavily on manufacturers' willingness to add new workers or to invest in new capital equipment, both of which were anticipated to grow ever so slightly in 2016, according to this latest report." (NAM Manufacturers' Outlook Survey – Fourth Quarter, 12/2015)

Small Business"Don't look for a small-business boom in 2016. . . . Surveys show owners generally have lowered expectations for their companies in 2016." ("Small Businesses Tend To Be Cautious About 2016 Outlook," The Associated Press, 1/11/2016)

"Pres. Barack Obama bid farewell to 2015 with a major blow to small businesses. Setting an all-time record, his administration packed the Federal Register with 82,036 pages of rules and regulations by the year's end, according to a new report from the Competitive Enterprise Institute (CEI). . . . More than 500 pages of the final regulations—545 pages to be exact—affect small businesses, including stifling components like the Environmental Protection Agency's Clean Power Plan, according to the CEI. Final rules make up 3,378 pages of this year's Federal Register, and another 2,334 regulations are still under consideration." ("Obama Broke a Chilling Regulatory Record in 2015," NFIB, 1/05/2016)

Mining & Energy"Mining and logging employment decreased by 8,000 in December. This was the industry's twelfth consecutive month of employment decline. Mining and logging has lost 131,000 jobs since December 2014. Mining drives the employment trend in this sector and accounts for essentially all losses over the month (-8,000) and over the year (-129,000). These losses were concentrated in support activities for mining." ("Current Employment Statistics Highlights December 2015, Bureau of Labor Statistics, 1/08/2016)

"Arch Coal filed for Chapter 11 protection on Monday, continuing an industry collapse that includes the bankruptcies of Patriot Coal, Walter Energy and Alpha Natural Resources. . . . According to the National Mining Association, 40,000 coal jobs have been lost in the U.S. since 2008." (Editorial, "The Carnage in Coal Country,"The Wall Street Journal, 1/11/2016)

"Economist Scott Anderson expects companies in the Midwest to have a tougher time than those on the East and West coasts because the energy and mining industries are struggling. Anderson, chief economist with Bank of the West, counted 123,000 jobs lost in those industries from 2014 to 2015. And the plunge in commodities prices is hurting companies related to agriculture, he says." ("Small Businesses Tend To Be Cautious About 2016 Outlook," The Associated Press, 1/11/2016)

• "More Job Cuts Expected For Oil Workers In 2016" ("More Job Cuts Expected For Oil Workers In 2016," USA Today, 1/01/2016)
• "[T]he cutbacks could in some areas be deepening. Oilfield-services firm Schlumberger Ltd. in December announced another round of job cuts in addition to 20,000 layoffs reported earlier in 2015. Agribusiness giant Monsanto Co. executives said this past week that it would cut an additional 1,000 jobs, after unveiling plans in October to eliminate 2,600 positions. Agriculture firms have been stung by falling commodity prices and lower farm incomes." ("Hiring Ends Year on Strong Note, but Wage Growth Remains Sluggish," The Wall Street Journal, 1/08/2016)

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