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MIDDLE-CLASS INTO POVERTY
American Middle Class

RAPID FALL FROM THE MIDDLE-CLASS INTO POVERTY

The estimated reading time for this post is 108 seconds

Before the country fell into the worst economic crisis since the Great Depression, America had record-high job gains months after months. Now, the pandemic-induced recession is decimating the middle class and below with no end in sight.

Nearly 900,000 Americans filed unemployment claims for the first time last week, 25 million more are receiving some form of unemployment compensations at the end of September, 8 million American middle-class fell into poverty since May, and millions of people are lining up at food banks across this great nation.

Between March and April, the economy lost about 23 million jobs.  The recovery started in June, but it appears that it is already starting to cool off. The underlying trends of the overall recovery are abysmal-V-shape recovery paused.

Even when the employment rate was at a historic low, millions of Americans, especially Gig and self-employed workers, did not have money left after paying all their bills to build emergency funds. Many of the fastest-growing jobs paid a hair above the poverty level wage.

Fragile American Middle-Class

The economy created many jobs during the decade-plus economic recovery after the 2008 financial crisis, but a vast majority of them were lower-paying and gig jobs.  For example, hospitality and entertainment made up nearly half of all the jobs created in Florida during that time.

Good paying-union jobs, pensions, and career development are good factors used to anchor the American middle-class, but they have been stripped away from them.  Sometimes, the middle class stripped themselves from those anchors at the ballot box.

Middle-class workers have to deal with dynamic scheduling, irregular hours, and unsteady workloads now.  Whether it is a temporary government shutdown or a pandemic-induced recession, any financial shock drops them to the lower rung of the economic ladder.

The $2 trillion fiscal stimulus package known as the CARES Act supported the middle class for the first 3 months. It was not enough to prevent so many hardworking Americans from falling into poverty.  The federally funded an extra $600 in weekly unemployment benefits and President’s executive order to fund an additional $300 in weekly benefits helped were helpful; however, the economy needs more fiscal help.  America can’t afford so American middle-class falling into poverty.

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