There’s a phenomenon happening in the United States, and it’s killing the middle class. The cost of living is rising significantly and its vastly outperforming salary increases. That means you could’ve once lived a comfortable life, the pinnacle of the American dream, but now you’re struggling to make it with virtually no change in your salary.
How can such a thing happen?
Matt and Nicole Barry are school teachers at Live Oak High School in California. Together, they make nearly $70,000. This, at one time, could afford the family life most of us wish we had. They live in a beautiful home in a nice neighborhood, but as of late, they’ve been getting squeezed.
Real estate costs in their city have skyrocketed. Not just that, but the price of literally everything has gone up too, from gas for the car to the food they eat. Taxes have risen, too. What was once a comfortable salary quickly turned into panic, as the Barry family found themselves not being able to cover their bills and their salary remains stagnant.
To make up for it, Matt has turned to Uber to make a bit of extra cash, which is a second job he really shouldn’t be forced to do. If you know anything about the teaching profession, it’s not a normal 9-to-5 job. It requires early mornings and late nights grading papers and planning a curriculum for students.
“Teachers are killing themselves,” says Matt Barry. “I shouldn’t be having to drive Uber at eight o’clock at night on a weekday. I just shut down from the mental toll: grading papers between rides, thinking of what I could be doing instead of driving — like creating a curriculum.”
Currently, the cost of living in the middle class is up as much as 30% higher than it was two decades ago. Everything is more expensive, from housing, to healthcare, getting a college degree, and raising a child. For a lot of families, who were once enjoying the good life, that daily cost of life has more than doubled.
Only one-forth of U.S. citizens considered themselves as part of the lower class before the 2008 crash, according to a Pew study. Now, that number has risen to over 40%. If less than half of all Americans believe themselves to be financially in the lower class, it shows how much the gap is widening between the wealthy and what used to be a healthy middle class.
It has really been the stability of our system that held up the middle class for so long. Jobs were secure, salaries rose to meet the cost of living, it was cheap to go to college and better your life, and benefits were plenty. Now, going to college is no longer a ‘need-to’ proposition. Students are graduating with useless degrees and with $40,000-$100,000 in debt.
And these are just the jobs that are usually know for security. If you want to be a lawyer or a doctor, it’s becoming almost impossible to find meaningful work. But what about the rest of Americans who have been struggling at $20,000/year and women who can’t seem to catch a break?
The Center for WorkLife Law has found that discrimination cases have risen 269% in the last decade as women seem to make less and less. Their salaries appear to job 7% for each child they have. At a time when woman are trying to do everything they can to prepare for life as a parent, they face tremendous standard-of-living obstacles most of us don’t.
Technology also plays a major part. If factories and manufacturers can replace a working body with a robot, they can. They don’t have to pay a salary or benefits to robots who can work 24/7 without needing a day off. These types of jobs are being eliminated at a furious rate. It’s expected that 30% of the tasks currently requiring human hands will be replaced in the near future.
There are a few economy-proof jobs that still exist, such as nursing, truckers, journalists, etc, but even these can see their share of drop-offs. Driverless trucks are making their debut and more doctors are seeing their patients via online Skype or FaceTime calls.
Most of these challenges appear to be holdovers from The Great Recession that hit our country in 2008. Jobs were hard to find and employers had a rush of new people coming in looking for work. Because the economy was down considerably, they didn’t feel it was safe to hire. That appears to be changing.
Currently, there are more open jobs than workers to fill them. Industries, like the trucking industry, have a rash of vacant seats they need filled immediately. The problem is, a lot of these jobs require training and/or being well-verses in a trade. Proponents for trade jobs like Mike Rowe keep pushing the need for skilled workers to fill these positions.
The country is changing, and everyone must figure out quickly where they belong in the new hierarchy. Those who figure it out are doing quite well and gaining most of the wealth while others fall behind trying to work jobs that used to have security and a high wage.
President Trump has recently come out with a new tax idea aimed at helping the middle class by cutting their taxes and creating programs to incentivize saving money. Hopefully this move will help people like the Barry family get back to normal and continue to focus on changing the lives of their students.