News Column

Great Recession's Scars May Be Permanent, Survey Says

May 7, 2013
newspaper

Five years into the devastating Great Recession and its aftershocks, millions of employed and unemployed Americans are still badly and perhaps permanently damaged financially and deeply pessimistic about near-and long-term prospects for the U.S. economy, a new nationwide survey finds.

Six in 10 Americans believe that the nation's economy has undergone a permanent change. More than half say that the economy will take at least six years to fully recover from the Great Recession, with 29 percent saying the economy will never fully recover. Looking further ahead, only one in five are confident that job and career opportunities will be better for the next generation of American workers.

The Great Recession's scope and impact was so widespread and corrosive that it will likely affect individuals, families, and the nation for many years to come. Among other findings of the survey conducted by the John J. Heldrich Center for Workforce Development at Rutgers, The State University of New Jersey:

* The recession has touched the vast majority of Americans personally.

* A majority of Americans (56 percent) report having less money in savings than before the recession began, including 38 percent who say they have a lot less.

* The vast majority thinks that college will be permanently out of the financial range for most young people.

* More than half of those who were laid off or lost a job during the recession say they cut back on medical treatment or doctor visits, 40 percent borrowed money from family or friends, and just under one in four have sought professional help for stress or depression.

The report, entitled Diminished Lives and Futures: A Portrait of America in the Great-Recession Era, was written by professors, Carl Van Horn and Cliff Zukin and graduate research assistant, Mark Szeltner of the John J. Heidrich Center for Workforce Development, a research and policy center at Rutgers University

Despite more than 35 months of private-sector job growth and a decline in unemployment, fewer than one in three Americans gauge the economy to be better than it was last year; nearly one in four say that it has gotten worse.

Only one in three of those surveyed expect economic conditions to improve a year from now, one in three expect the economy to be in worse shape, and the rest think it will be the same.

American workers blame high levels of unemployment principally on global competition. Seven in 10 respondents (70 percent) attribute high levels of joblessness to competition and cheap labor from other countries; 4 in 10 (40 percent) believe illegal immigrants have taken jobs away from Americans. Another 4 in 10 (41 percent) believe that unemployment remains high because American workers lack the skills needed for jobs that might be available today.

The Great Recession damaged the financial status of all but a small minority of Americans. Only 14 percent felt no impact at all while 35 percent say the recession had a major impact on their lives. Among the financial and personal sacrifices made by Americans:

* More than half (56 percent) now have less in savings than they did before the Great Recession, including 38 percent who have a lot less in savings;

* Nearly half drew funds from their savings; and

* Three in 10 borrowed money from family or friends.

Americans are deeply skeptical about the ability of Washington-based policymakers to turn the economy around. Four in 10 trust neither President Obama nor Congress to effectively manage the economy. Despite their misgivings, Americans want government to take action to lower unemployment. The survey found broad consensus for two strategies and strong support for a third:

* Eight in 10 (81 percent) want the government to give tax credits to employers that hire new workers;

* Three in four (76 percent) support more robust education and training programs; and

* Six in 10 (60 percent) say the government should fund direct job creation programs.



Source: Copyright Northeast Pennsylvania Business Journal 2013