WHY IS OUR NATION WORSE OFF NOW?
Americans are stressed financially, especially women.
Nearly two out of three people live paycheck to paycheck.
A family of four is paying $1,261 per month more to purchase the same goods and services compared to January 2021.
National gas prices haven’t been below $2/gallon in three years.
Mortgage interest rates have priced out Millennials and Gen Z.
People are working multiple jobs to afford a life that one job used to support.
Persistent high inflation has forced older Americans to delay retiring or unretire.
Sadly, younger generations worry about their parents’ retirement and their own.
No one seems concerned about OUR NATION’S $34 TRILLION DEBT.
How have things changed over the last few years?
Prior to 2020, the U.S. economy was booming. Americans were enjoying the benefits— — from pay raises to lower taxes to higher rates of business ownership.
In 2020, the world was turned upside down by a once-in-a-generation global pandemic that upended the U.S. economy. The uncertainty of the virus made it a scary time. Federal, state, and local governments implemented drastic restrictions. Some 20 million Americans lost their jobs during those early months and 200,000 businesses were shuttered for good.
To cushion Americans, policymakers deployed historically large fiscal stimulus packages totaling roughly $5 trillion in 2020 and 2021 to individuals, businesses, hospitals, local governments, and schools as they grappled with COVID-19.
Unfortunately, there were short-term and long-term costs to too much federal stimulus spending. Unnecessary cash benefits, particularly the nearly $2 trillion American Rescue Plan, drove consumers to spend on goods and services beyond what producers could supply and incentivized people to not work.
Inflation took off across the economy, peaking at an eye-popping 9.1% in June 2022—a level not seen in 40 years. Frustratingly, inflation remains elevated. Low-income families and households on a fixed budget are hurting the most.
Today, the pandemic is behind us, but we still feel the residual impacts of government policies making life for many households worse than before. Here is how different demographics are faring:
How did we get here?
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The pandemic disrupted tremendous gains women made in the labor force. Millions of women left the workforce to caregive, oversee their children’s remote learning, or just to stay at home. Positively, women’s employment returned to its pre-pandemic level, but they may not feel too relieved.
Despite employment gains, paychecks do not go far enough because of inflation. Rising prices on groceries, gas, and utilities have caused real wages to fall, leaving households feeling like they got a pay cut.
Employment doesn’t equal financial security. Women are more likely to be stressed out about their finances than men—and they’re afraid. Over half of women worry they won’t make ends meet (compared to a third of men). Only about a third of women say they are doing well financially. Women are also more likely than men to work multiple jobs. Meanwhile, paid time off is elusive for many women. Balancing work with caregiving responsibilities is often costly and challenging, leaving women frustrated and discouraged.
We can’t solve every problem for women, but we can push for greater flexibility. This frees them to work on their schedules and around the priorities most important to them. We should fight for work arrangements that provide women with fulfilling, flexible opportunities and paid time off. We also need to create an environment in which parents have a variety of quality, flexible, accessible childcare options that meet their unique needs.
Protect Independent Contracting
Remove Excessive Occupational Licensing
Eschew ESG Investing and Workplace Quotas
Financially Support Families, Not Daycare Providers
Expand Flexibility and Paid Time Off
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Retiring financially secure seems less likely today. Frighteningly, more than half of 50+ workers lose longtime jobs before they are ready to retire. Of those, nine out of 10 never recover their previous earnings. Older workers are also more likely to wrestle with prolonged joblessness than younger workers.
The pandemic accelerated a mass retirement of 2.4 million older workers—more than half of the 4.2 million workers who left the workforce. However, because of inflation, losses in retirement savings, and other reasons, 1.5 million retirees headed back to work by early 2022, choosing to “unretire.”
Even prior to the pandemic, older workers, especially women, reported dealing with age discrimination. Although discriminating against workers because of their age or years of experience is illegal, nearly two out of three women (64%) say they have experienced it in the workplace, compared to 59% of men. A plurality of women say this unfair treatment occurs daily.
Older workers should be respected in the workplace. They should not be restricted from working for themselves or in flexible arrangements that allow them to manage their health and other priorities. We should help them keep their earnings and maximize their savings to provide them security in the later years of their lives.
Encourage Personal Savings Accounts for Retirement
Preserve Social Security
Right-Size the Social Safety Net
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Young Americans, more than any other generation, are most likely to believe that the American Dream is unattainable or does not exist.
More than half of Millennials and Gen Z live paycheck to paycheck. Two out of three have been priced out of the homebuying market due to high borrowing costs. Meanwhile, pluralities of younger generations have second part-time or full-time jobs just to make ends meet.
High costs of college and rising household debt further cripple American households. College tuition and fees have risen by 40 percentage points for the years 2005-2014—far above the rate of inflation. Americans owe $1.77 trillion in student loan debt. One-third of adults under 30 owe some federal student loans compared to one in six adults overall.
Increasingly, a high school diploma and even hands-on experience and skills are not enough to secure middle-class jobs. Both younger and older adults feel the pressure to pursue higher education despite the high costs of college and questionable post-graduation job prospects. Among nearly all demographic groups, the majority believe they will have more opportunities than their parents, except for Americans without a high school diploma.
We can help young people chart a path to the middle class and beyond by removing the barriers that keep them from entering into desired careers, starting entrepreneurial pursuits, and growing their earnings. They should be able to keep more of what they earn, have greater control over how to invest for the future, and find creative ways to lift the student loan debt burden on their shoulders.
Fight Degree Inflation
Encourage Saving for Education Early
Tax Universities
Make The 2017 Tax Cuts Permanent
Pursue Creative Alternatives to Student Loans and Payment Plans
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Entrepreneurship has been the key to the American Dream for many men and women. Today, women own 12 million small businesses (or 43% of all small businesses). Female immigrants and women of color have become one of the fast-growing demographics of entrepreneurs.
Small business owners were rattled by the pandemic-induced lockdowns but managed to survive the pandemic. New enterprises emerged. However, inflation and an onslaught of new regulations beginning in 2021 threaten to put mom-and-pop shops out of business.
Entrepreneurs are straddled with confusing new rules and costly regulations. Compliance costs end up being higher for small businesses than for the average firm.
From licensing to restrictions on independent work to new tax reporting requirements, the government should not impose burdens on entrepreneurs and small businesses that make it difficult to start and grow.
Reduce Regulatory Burden on Small Businesses
Reforming the 1099-K Reporting Requirement
Cut the Red Tape Binding Our Economy
Embrace Tax Reform and a Balanced Budget
What We Can Do
Bipartisan and common-sense reforms can take control over your career choices, entrepreneurial pursuits, and financial futures.
What are these policy solutions? Continue to our Working for Women report for more information.