Posted November. 14, 2008 08:15,
With home prices dropping, the job market slumping, and incomes falling, the American people are increasingly feeling the pinch from the deepening economic recession.
Failing to find jobs for several months, some are driving cars without insurance and others are cutting medical expenses. College seniors are getting distressed for fear of not getting jobs after graduation.
○ Home vacancies rising
In New Jersey, 10 percent of homes are designated houses of cards, whose owners are unable to pay outstanding mortgage loans even after selling their homes. Many home owners are simply allowing banks to take over their homes.
The situation in New Jersey is relatively better than in other states, however. In Nevada, where home prices were disproportionately inflated, distressed properties account for 47.8 percent of the housing market. In Michigan, the home of the struggling U.S. auto industry, the share of distressed homes is 38.6 percent.
As business conditions worsen, the number of vacant stores is increasing. Michael Choi, who runs a building rental business in a shopping district in Virginia, said, Five shops have remained vacant for several months. This is the first time Ive experienced this since I began this business 20 years ago.
Two tenants filed for bankruptcy after failing to pay their debts and moved out. Though their contracts still had time left on them, I returned their deposits.
○ Unemployment at 14-year high
The New York Times recently reported the story of Ken Stelma, 49, who lost his job in January as a customer care representative for a kitchen installation company.
He receives a weekly unemployment check of 562 U.S. dollars, less than half of 1,200 dollars he used to get from his old company.
Stelma can no longer afford to pay 250 dollars a month for his provisional health coverage, a carryover from his job that he will lose next month.
He said he has sent his resume to 10 companies, including Home Depot, but has gotten no responses.
The U.S. Labor Department said unemployment last month rose to 6.5 percent from 6.1 percent, the highest since 1994. The number of jobless also topped 10 million.
Kim Dae-yeong, a Korean American in Virginia, said, Many Korean Americans engage in small-size construction businesses. Due to the slumping construction market, the majority of them have been idle for several months.
○ College grads out of work
Miguel Melendez graduated from State University of New York-Stony Brook in May with a double major in sociology and history. He has yet to find a job despite sending out 300 resumes.
Melendez, who is now taking odd jobs painting houses to repay his student loans, said he wanted to first apply for marketing jobs and then those related to politics, but could find nothing in this uncertain economic condition.
Recent data from the National Association of Colleges and Employers showed 52 percent of American companies have no plans to hire, giving more burdens to college seniors.
○ Patients skipping on medicine
Martin Schwarzenberger, an accounting manager in Kansas City, often skips his diabetes medicine due to lack of money. Dont tell my wife, but if I have 30 days worth of pills, Ill usually stretch those out to 35 or 40 days, he said.
The middle class is also tightening purse strings. Luxury retailer Neiman Marcus suffered a sales drop of 27 percent last month. JC Penney, which mainly caters to middle-class housewives, saw a sales hit of 13 percent in the same month.
A housewife in Bergen County, N.J., said her husband earns an annual salary of 120,000 dollars, but he is worried over being laid off due to a growing number of companies laying off workers. She added they are avoiding dining out and cutting living expenses.