Rampant Unemployment = The Death Of The Middle Class

40 Facts That Prove The Working Class Is Being Systematically Wiped Out

The Economic Collapse Blog
July 9, 2011

Without an abundance of good jobs, the middle class in the United States is going to shrivel up and die. Right now, rampant unemployment is absolutely killing communities all over America. Hopelessness and poverty are exploding and many are now wondering if we are actually witnessing the slow death of the middle class. There simply are not nearly enough “good jobs” to go around anymore, and even many in the mainstream media are referring to this as a “long-term structural problem” with the economy. The only thing that most working class Americans have to offer in the marketplace is their labor. If nobody will hire them they do not have any other ways to provide for their families. Well, there is a problem. Today wealth has become incredibly centralized. The big corporations and the big banks dominate everything. Thanks to incredible advances in technology and thanks to the globalization of our economic system, the people with all the money don’t have to hire as many ordinary Americans anymore. They can hire all the labor they want on the other side of the globe for a fraction of the cost. So the rich don’t really have that much use for the working class in America anymore. The only thing of value that the working class had to offer has now been tremendously devalued. The wealthy don’t have to pay a lot for physical labor anymore. Thousands of our factories and millions of our jobs have been shipped overseas and they aren’t coming back. The big corporations are thriving while tens of millions of ordinary Americans are deeply suffering. Almost all of the wealth being produced by our economy is going to a very centralized group of people at the very top of the food chain. The rich are getting richer and the working class is being systematically wiped out.

So the fact that we are facing rampant unemployment that never seems to go away should not be a surprise to anyone. Today, the “official” unemployment rate went up to 9.2 percent even though a whopping 272,000 Americans“dropped out of the labor force” in June. The government unemployment figure that includes “discouraged workers” went up from 15.8% to 16.2%. The mainstream media is proclaiming that this was “a horrific report” because most economists were expecting much better news.

Well, guess what?

Things are going to get a whole lot worse.

More job cuts are coming. One recently released report found that the number of job cuts being planned by U.S. employers increased by 11.6% in June.

It is also being projected that state and local governments across the U.S. will slash nearly half a million more jobs by the end of next year.


Needless to say, things don’t look good.

Most people that still have jobs are desperately trying to hold on to them.

Employers know that most workers are easily replaceable these days, so wages are not moving up even though the cost of living is.

We are right in the middle of the worst employment downturn since World War 2. Jay-Z recently summed up the situation this way….

“Numbers don’t lie. Unemployment is pretty high.”

Jay-Z certainly has a way with words, eh?

If something is not done about the rampant unemployment in this nation, the death of the middle class will accelerate.

Most Americans just assume that the United States will always have a large middle class, but there is no guarantee that is going to happen. In fact, there is a whole lot of evidence that the middle class in America is rapidly shrinking.


Take a few moments to read over the facts compiled below. Taken together, they provide compelling evidence that the working class is being systematically wiped out….

#1 Right now, the U.S. government says that 14.1 million Americans are unemployed.

#2 There are fewer payroll jobs in the United States today than there were back in 2000 even though we have added 30 million people to the population since then.

#3 The number of Americans that are “not in the labor force” is at an all-time high.

#4 The United States has never had an employment downturn this deep and this prolonged since World War 2 ended.

#5 There are officially 6.3 million Americans that have been unemployed for more than 6 months. That number has risen by more than 3.5 million in just the past two years.

#6 It now takes the average unemployed worker in America about 40 weeks to find a new job. Just check out this chart….


#7 There are now about 7.25 million fewer jobs in America than when the recession began back in 2007.

#8 Back in 2000, the employment to population ratio was over 64 percent. Today, it is sitting at just 58.2%.

#9 Only 66.8% of American men had a job last year. That was the lowest level that has ever been recorded in all of U.S. history.


#10 During this economic downturn, employee compensation in the United States has been the lowest that it has been relative to gross domestic productin over 50 years.

#11 The number of “low income jobs” in the U.S. has risen steadily over the past 30 years and they now account for 41 percent of all jobs in the United States.

#12 Half of all American workers now earn $505 or less per week.

#13 According to a report released in February from the National Employment Law Project, higher wage industries are accounting for 40 percent of the job losses in America but only 14 percent of the job growth. Lower wage industries are accounting for just 23 percent of the job losses but 49 percent of the job growth.

#14 The United States has lost a staggering 32 percent of its manufacturing jobs since the year 2000.


#15 Between December 2000 and December 2010, 38 percent of the manufacturing jobs in Ohio were lost, 42 percent of the manufacturing jobs in North Carolina were lost and 48 percent of the manufacturing jobs in Michigan were lost.

#16 Back in 1970, 25 percent of all jobs in the United States were manufacturing jobs. Today, only 9 percent of the jobs in the United States are manufacturing jobs.

#17 Do you remember when the United States was the dominant manufacturer of automobiles and trucks on the globe? Well, in 2010 the U.S. ran a trade deficit in automobiles, trucks and parts of $110 billion.

#18 In 2010, South Korea exported 12 times as many automobiles, trucks and parts to us as we exported to them.

#19 The United States now spends more than 4 dollars on goods and services from China for every one dollar that China spends on goods and services from the United States.

#20 Since China entered the WTO in 2001, the U.S. trade deficit with China has grown by an average of 18% per year.

#21 The U.S. trade deficit with China in 2010 was 27 times larger than it was back in 1990.

#22 The United States has lost an average of 50,000 manufacturing jobs per month since China joined the World Trade Organization in 2001.

#23 In 2002, the United States had a trade deficit in “advanced technology products” of $16 billion with the rest of the world. In 2010, that number skyrocketed to $82 billion.

#24 Manufacturing employment in the U.S. computer industry was actually lower in 2010 than it was in 1975.

#25 Since 2001, over 42,000 manufacturing facilities in the United States have been closed.

#26 There were more manufacturing jobs in the United States in 1950 than there are today.

#27 Since the year 2000, we have lost approximately 10% of our middle class jobs. In the year 2000 there were about 72 million middle class jobs in the United States but today there are only about 65 million middle class jobs. Meanwhile, our population has gotten significantly larger.

#28 When you adjust wages for inflation, middle class workers in the United States make less money today than they did back in 1971.

#29 One recent survey found that 9 out of 10 U.S. workers do not expect their wages to keep up with soaring food prices and soaring gas prices over the next 12 months.

#30 Only the top 5 percent of U.S. households have earned enough additional income to match the rise in housing costs since 1975.


#31 One out of every six elderly Americans now lives below the federal poverty line.

#32 According to one recent study, approximately 21 percent of all children in the United States were living below the poverty line in 2010.

#33 Back in 1965, only one out of every 50 Americans was on Medicaid. Today, one out of every 6 Americans is on Medicaid.

#34 As 2007 began, there were 26 million Americans on food stamps. Today, there are more than 44 million Americans on food stamps, which is an all-time record.

#35 Today, one out of every four American children is on food stamps.

#36 59 percent of all Americans now receive money from the federal government in one form or another.

#37 The number of Americans that are going to food pantries and soup kitchens has increased by 46% since 2006.

#38 In the United States today, the richest one percent of all Americans have a greater net worth than the bottom 90 percent combined.

#39 According to Moody’s Analytics, the wealthiest 5% of all households in the United States now account for approximately 37% of all consumer spending.

#40 The poorest 50% of all Americans collectively own just 2.5% of all the wealth in the United States.

The cold, hard reality of the matter is that the United States is experiencing a long-term economic decline.

Every single day, more American families fall out of the middle class and into poverty. There are millions of American families out there tonight that are just barely hanging on by their fingernails.

More Americans than ever are constantly borrowing more money just to stay afloat. Even as rampant unemployment plagues this nation and even as wages remain stagnant, middle class Americans are increasing their use of credit.

A CNBC article noted the increase in consumer borrowing that we have seen recently….

The Federal Reserve says consumer borrowing rose $5.1 billion following a revised gain of $5.7 billion in April. Borrowing in the category that covers credit cards increased, as did borrowing in the category for auto and student loans.

It is very hard to live “the American Dream” without going into huge amounts of debt these days.

But for an increasing number of Americans, “the American Dream” is just a distant memory.

Tonight, there are large numbers of people living in the tunnels under the city of Las Vegas. As the wealthy live the high life in the casinos and hotels above them, an increasing number of desperate “tunnel people” are attempting to carve out an existence in the 200 mile long labyrinth of tunnels that stretches beneath Vegas. It is a nightmarish environment, but it is all those people have left.

Don’t look down on them, because you never know who might be next.

If you lost your current job, how long would you be able to survive?

Unfortunately, as bad as things are now, the reality is that this is just the beginning.

You ain’t seen nothin’ yet.

Do what you can to make sure that you and your family are not totally wiped out by the next wave of the economic collapse.

WHERE WILL THE CHILDREN GO?

Editorial by Dr. J. P. Hubert

If the United States continues to lose the ever more diminutive manufacturing base it still has, where will the next generation of American’s go? Only a small percentage will be able to work as so-called “professionals”, attain fame, celebrity or become professional sports figures—the vast majority will be consigned to working in service industries at minimum wage. Virtually every great industry the US once possessed has been lost except for high tech munitions (being given to Israel and sold to our “enemies”) and civilian aviation (about to be challenged by China).

As our country becomes more “third world” signified by the complete loss of a middle class, it is more not less likely that minimum wage jobs will be lost, in favor of those which can charitably be termed slave labor. Moreover, without a drastic change in US trade policy including the erection of significant protective tariffs and control of at least the southern border, this reality will no doubt be upon us sooner rather than later.

The international corporatists who presently control US trade policy are wedded to an economic theory (free trade ala Milton Friedman) which however well intended is intellectually bankrupt [it could only function equitably if all trading partners were equally developed]. The present situation (unfair trade in which American workers must compete against sweat shop laborers abroad) has made the once great American manufacturing sector (presently on life-support) nearly moribund. It could not be resurrected now without exposing the populace to widespread suffering and distress particularly for those of lesser means.

Given that as a nation we can no longer produce the goods upon which we all depend for daily living, we are literally at the mercy of the nations (see this) , who currently supply them including China, Japan, and Korea among a few others. Unfortunately, China and Japan are also two of our most important bankers. We owe them at least 2 trillion dollars of borrowed money much of which is financing the wars in Afghanistan and Iraq). At present we pay only interest. It is doubtful that we could repay the principle all at once (if it suddenly became necessary to do so—were either to call in their US Treasury Notes).

Many school-age children will no doubt need to seek employment opportunities abroad lest they be consigned to a life of economic depravation in the US. Barring a complete paradigm shift in US trade policy, border control, and a Manhattan Project-like dedication to rebuilding the manufacturing/production base of the nation, out-migration of many of our youngest American’s is inevitable with clearly negative implications for unfunded liabilities such as entitlements. Clearly, those with the most talent, intellect and initiative will be tempted to seek a better life elsewhere. The question is—where?

"Made in China" = Social Injustice

Over the past several years it has become painfully obvious that almost everything one purchases in the United States is either made in China, Mexico or Korea. One is hard pressed to find any major consumer article which is not manufactured in part or entirely in one of these three. All have in common the lack of basic worker's rights, environmental protection and adequate levels of financial remuneration for labor. The retail cost of many items in the United States is thus being kept artificially low by disadvantaging the world's poor. In the process of course, millions of American's have lost the manufacturing jobs which once provided them with a middle class standard of living. It is impossible for Americans or anyone else in the “developed” world to compete with what is essentially slave labor.

These developments are directly traceable to “free-trade” (read unfair trade) agreements which now artificially support a global economy pitting an extremely small number of “haves” against a large number of “have-nots.” If it were impossible for multinational American corporations to outsource/off-shore labor and manufacturing costs without incurring a steep tax when importing their products back into the US, the present unjust arrangement would cease. The elite political class has been induced to play along of course because of the extraordinarily large campaign contributions made on behalf of multinational corporations and their lobbyists. Tragically both political parties willingly cooperate.

The present system is inherently unjust and all people of good will should ban together to change what has become a global form of social/economic Darwinism (survival of the ruthless). Only a preciously small elite oligarchy of corporate internationalists benefit financially from the present morally illicit global economic system. In the interim, the once great American manufacturing base has been decimated, high-tech industry is increasingly being transferred to India and China and fewer and fewer people in the United States are able to project an adequate level of subsistence beyond the present generation.

Carried to its logical conclusion, America will rapidly complete its descent into “third-world” status. No nation which is incapable of providing its own goods (not just services) can survive for long. Most of our citizens who have lost manufacturing jobs have replaced them with lower paying “service” sector employment. Eventually, there will be few left in the US to pay for the plethora of foreign made imports especially those of a more costly nature. By then of course the corporate internationalists can simply relocate to other more affluent developed nations and markets, leaving the vast majority of Americans to fend for themselves.

Now more than ever before, it is necessary for all people of good will to think clearly about the future and to ban together in acts of social justice in an attempt to alter unfair and defective social/economic structures. The 2008 presidential election run-up is an ideal time in which to begin.

--Dr. J. P. Hubert