Today’s Consumer: Cash Strapped, Loaded With Debt, Living Beyond Their Means

As last week’s GDP data came in better than expected, several top economists said they don’t expect the engine to run at high RPMs for the rest of the year. Still, it was notable. And when coupled with retail sales (up 1.6 percent in March) and consumer confidence (up in North America, according to the Conference Board), the overall picture is bright for the retail industry. Or is it? The 35-day government shutdown that ended in late January exposed a vulnerability of U.S. consumers: About 80 percent of all U.S. families, which includes minimum wage earners to those classified as upper middle class, are living paycheck to paycheck — meaning they don’t have enough savings to pay bills, their rent or buy food. This data is based on a 2017 survey by CareerBuilder, and later backed up with additional, more recent data from Bankrate and the Federal Reserve. During the shutdown, Wilbur Ross, U.S. secretary of commerce, suggested government workers get personal loans to help make ends meet while other policymakers told them to take on second jobs. Due to a variety of factors, today’s consumers are simply cash-strapped and saddled with debt. And while politicians have used “income inequality” as a rallying

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