Americans still do not believe that they can find jobs. The news should not be surprising in an environment in which large companies still cut hundreds if not thousands of people at a time, local and state governments cannot afford their employees and small businesses have no access to money.
The jobs concern has wide implications for consumer spending–the engine of the US economy. Figures show that a retail recovery has faltered. People are too worried about their job security and future income prospects.
A new poll by Gallup says that “Eighty-four percent of Americans in January say now is a “bad time” to find a quality job, down slightly from 90% in January 2010, but continuing a trend of high negativity that has persisted for more than two years.”
The fire just behind the smoke is that many companies are concerned that 2011 profits could slip behind those of last year. A worried consumer is only part of the reason. Beyond that, inflation threatens to cut into margins are millions of American firms. There is not guarantees that these companies can raise retail prices to offset the cost of goods, especially in an environment in which many Americans believe that the recession has not ended. The problem creates a vicious circle. Employers concerned about profits continue to lay off and laid off consumers disappear from retailers.
Douglas A. McIntyre
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