Latest news with #LudwigInstituteforSharedEconomicProsperity
Malaysian Reserve
a day ago
- Business
- Malaysian Reserve
'Functional Unemployment' Rises; Black, Hispanic Workers Take Biggest Hit, Says Ludwig Institute
Market for jobs paying above poverty wages continues to weaken WASHINGTON, Aug. 13, 2025 /PRNewswire/ — Prospects for workers seeking jobs paying above poverty wages worsened in July, particularly for Black and Hispanic earners, according to the latest report from the Ludwig Institute for Shared Economic Prosperity (LISEP). LISEP's July True Rate of Unemployment (TRU) report—a measure of the functionally unemployed, defined as the jobless plus those seeking, but unable to find, full-time employment and those in poverty-wage jobs—increased 0.6 percentage points, from 24.1% to 24.7%, in contrast with the Bureau of Labor Statistics official rate, which increased only 0.1 percentage points to 4.2%. The functional unemployment rate has now remained at 24% or higher for six consecutive months, which marks a higher level than at the end of 2024. Additional signs of weakness in the labor market include a rise in the True Rate of Unemployment Out of the Population—a measure of functional unemployment for the entire working age population—reflecting a decline in labor force participation, both month-over-month and year-over-year. In addition, the TRU for prime-age workers (25-54) increased by 0.4 percentage points, from 17.3% to 17.7%. 'With good-paying job opportunities waning, low- and middle-income households continue to feel the pressure on multiple fronts—from stubborn inflation to the rising cost of basic necessities, ultimately eroding wage growth,' said LISEP Chair Gene Ludwig. 'Meanwhile, economic policymakers have been slow to react, and it all comes down to headline statistics that do not accurately reflect what's going on in the lives of working Americans.' The 0.6 percentage point increase in the national functional unemployment rate was driven by an increase in the TRU for Black and Hispanic workers, with both posting their highest levels since 2021. The rate for Black workers rose a full percentage point, to 28.9%, while the TRU for Hispanic workers increased 1.7 percentage points, to 29.5%. The rate for White workers remained steady, dropping 0.1 percentage points, to 22.6%. Year-over-year, the TRU has worsened for Black and Hispanic workers but improved for White workers. By gender, the TRU increased for men by 1 percentage point, to 20.6%, while the rate for women remained stable with a 0.1 percentage point improvement, falling to 29.5% 'Often our TRU reports will indicate winners and losers for any given month, but for June, there are really no winners,' Ludwig said. 'Low- and middle-income workers and their families continue to struggle, with this recent rise in functional unemployment adding an additional strain. Further erosion is unsustainable' About TRULISEP issued the white paper 'Measuring Better: Development of 'True Rate of Unemployment' Data as the Basis for Social and Economic Policy' upon announcing the new statistical measure in October 2020. The paper and methodology can be viewed here. LISEP issues TRU one to two weeks following the release of the BLS unemployment report, which occurs on the first Friday of each month. The most recent TRU and supporting data are available on the LISEP website at About LISEPThe Ludwig Institute for Shared Economic Prosperity (LISEP) was created in 2019 by Ludwig and his wife, Dr. Carol Ludwig. The mission of LISEP is to improve the economic well-being of middle- and lower-income Americans through research and education. LISEP's original economic research includes new indicators for unemployment, earnings, and cost of living. These metrics aim to provide policymakers and the public with a more transparent view of the economic situation of all Americans, particularly low- and middle-income households, compared with misleading headline statistics. On X: @LISEP_org. About Gene LudwigIn addition to his role as LISEP chair, Gene Ludwig is a managing partner of Canapi LLC, a financial technology venture fund. He is the founder and CEO of Ludwig Advisors, which counsels financial firms on critical matters. Ludwig is also the founder of the Promontory family of companies. He is the former vice chairman and senior control officer of Bankers Trust New York Corp. and served as the U.S. Comptroller of the Currency from 1993 to 1998. He is also author of the book The Vanishing American Dream, which investigates the economic challenges facing low- and middle-income Americans. His forthcoming book, The Mismeasurement of America, will be published in September 2025 and is available for pre-order wherever books are sold. On X: @geneludwig. CONTACT: Jim Gardner press@ (573) 680-1822
Yahoo
3 days ago
- Business
- Yahoo
Former Comptroller of the Currency Gene Ludwig Addresses Misleading Headline Economic Statistics in Upcoming Book "The Mismeasurement of America"
Government headline stats on jobs, wages, inflation distort economic reality, Ludwig says WASHINGTON, Aug. 11, 2025 /PRNewswire/ -- In his new book "The Mismeasurement of America" former Comptroller of the Currency Gene Ludwig, in his capacity as chairman of the non-profit Ludwig Institute for Shared Economic Prosperity (LISEP), chronicles why public perceptions of the economy differ so significantly from what government-issued headline statistics lead us to believe. The truth, he says, is somewhat disconcerting: The statistics are misleading. "Despite headlines heralding growth and prosperity, most Americans have fallen behind," Ludwig said. "They're working harder year-upon-year not to get ahead but to merely survive. For them, the American dream appears to be slipping farther and farther away." Specifically, Ludwig notes how outdated definitions of economic indicators—some over a century old—distort perceptions of unemployment, wages, inflation, and upward mobility and growth. For instance, unemployment statistics count an individual as employed even if they've only worked a few hours every two weeks. Meanwhile, inflation is measured by an expansive basket of more than 80,000 items, instead of focusing on the core necessities that consume nearly the entire budget of the average low- and middle-income household. "The real issue is how these data are presented," Ludwig said. "At LISEP, we have long advocated for more-responsive and real-world-reflective metrics to measure economic performance. Relying on less accurate, incomplete, and less-transparent data will only lead to misinformed economic policy." In "The Mismeasurement of America" Ludwig presents new, more-accurate ways to understand what's really happening in the American economy, proposing economic metrics that are truly reflective of the real world. "Sound economic policy, like a good weather forecast, relies on timely, comprehensive data," Ludwig said. "But unlike an errant weather forecast—which might lead to minor inconveniences like a wardrobe mismatch or getting caught in the rain without an umbrella—inaccurate economic data could result in policy that means the difference between prosperity and recession." "The Mismeasurement of America" is now available for pre-order through major booksellers and set for release Sept. 30. About LISEPThe Ludwig Institute for Shared Economic Prosperity (LISEP) was created in 2019 by Ludwig and his wife, Dr. Carol Ludwig. The mission of LISEP is to improve the economic well-being of middle- and lower-income Americans through research and education. LISEP's original economic research includes new indicators for unemployment, earnings, and cost of living. These metrics aim to provide policymakers and the public with a more transparent view of the economic situation of all Americans, particularly low- and middle-income households, compared with misleading headline statistics. On X: @LISEP_org. About Gene LudwigIn addition to his role as LISEP chair, Gene Ludwig is founder of the Promontory family of companies and Canapi LLC, a financial technology venture fund. He is the founder and CEO of Ludwig Advisors, which counsels financial firms on critical matters. Ludwig is the former vice chairman and senior control officer of Bankers Trust New York Corp. and served as the U.S. Comptroller of the Currency from 1993 to 1998. In addition to his forthcoming book, "The Mismeasurement of America," he is also the author of "The Vanishing American Dream," which investigates the economic challenges facing low- and middle-income Americans. On X: @geneludwig. View original content to download multimedia: SOURCE Ludwig Institute for Shared Economic Prosperity Fehler beim Abrufen der Daten Melden Sie sich an, um Ihr Portfolio aufzurufen. Fehler beim Abrufen der Daten Fehler beim Abrufen der Daten Fehler beim Abrufen der Daten Fehler beim Abrufen der Daten
New York Post
05-07-2025
- Business
- New York Post
Most Americans can no longer afford even a ‘minimal quality of life,' depressing new study finds
The American dream is slipping away. Most US citizens no longer enjoy 'a minimal quality of life' due to skyrocketing costs, a depressing new study has uncovered. Ludwig Institute for Shared Economic Prosperity conducted research into the economic well-being of the country's residents, defining 'minimal quality of life' as the ability to pay for a 'basket of American dream essentials': housing, food, transportation, clothing, medical costs and basic leisure expenses. The leisure expenses included access to cable TV and streaming services, as well as the ability to pay for six movie tickets and two baseball tickets per year. The Minimal Quality of Life index goes 'beyond traditional cost-of-living measures to provide a more comprehensive understanding of what it takes to secure a foothold on the bottom rung of the American dream ladder and have a real opportunity to climb it over time,' the authors wrote. The bottom 60% of American households by income fell well short of that threshold, the researchers damningly determined. The bottom 60% of American households by income fell well short of that threshold, the researchers damningly determined. The bottom 60% of American households by income fell well short of that threshold, the researchers damningly determined. 'The MQL reveals the harsh reality that the American dream, with its promises of well-being, social connection, and advancement, is out of reach for many,' the authors concluded. 'Rising costs in essential areas like housing, healthcare, and education significantly outpace wage growth, leaving millions struggling to attain even a minimal quality of life.' An average American couple with two children would need to spend $120,302 per year to cover the minimum quality of life expenses, the researchers determined. Skyrocketing costs over the past two decades are to blame, with medical premiums rising 301% from 2001 to 2023. Transportation, groceries and childcare have all increased in price by more than 50% on average across that same period. Transportation, groceries and childcare have all increased in price by more than 50% between 2001 and 2023. 'I get tired of the 'Stop your Starbucks latte habit' [advice], because in reality it's not people's fault,' financial planner Laura Lynch told CNBC in relation to the study. 'The structures around us have created an expectation of a lifestyle that is increasingly becoming unreachable for folks.'
CNBC
13-06-2025
- Business
- CNBC
Americans are losing spending power, say researchers: Most can no longer afford a 'minimal quality of life'
In 2023, about 11% of Americans officially lived in poverty, according to the U.S. Census Bureau. Even more struggle financially, though — and the share may be higher than you think. Many of the headline economic stats you see are based on "survival indexes," says Gene Ludwig, founder of the Ludwig Institute for Shared Economic Prosperity, and don't reflect Americans' full financial picture. "What people are thinking about — a real shared prosperity — is not, 'I can survive,' but, 'What does it take to live a middle-class life?'" he says. "'What does it take to be on the first rung, at least, of the American dream?'" To that end, LISEP developed a "Minimal Quality of Life Index," which takes into account not only essentials, such as food and shelter, but also the costs living a fulfilling life with a chance at upward mobility. Food costs in the model, for example, include occasional trips to casual restaurants as well as the cost of hosting an annual holiday meal. The index factors in basic leisure costs, such as cable and streaming subscriptions, and trips to the six movies and two MLB games per year in the cheap seats. According to LISEP's analysis, most Americans don't meet that standard. In 2023, the bottom 60% of households by income fell well short of the threshold for a minimal quality of life. That's largely because wages have failed to keep up with rising costs, the researchers say. Medical premiums rose 301% from 2001 to 2023, they note, while travel expenses were up 170%. Rent grew by 131%. The cost of raising children, which includes saving for higher education, by LISEP's estimates, grew by 107%. With wages failing to keep pace, LISEP finds that consumers' real spending power decreased by 4%, on average, over that period. Americans who fall short of the minimal quality of life costs may sink into debt or have to forego important financial planning steps, such as saving for college or investing for retirement, to afford modest discretionary expenses such as a gym membership or an occasional vacation. For families looking to get on the path to upward mobility, "it is hard to give advice without being patronizing," says Kevin Brady, a certified financial planner with Wealthspire Advisors. If your budget is stretched thin and you have mouths to feed, there's only so much financial maneuvering that can help. That said, there are a couple key things you can do to lower your living costs and help you put more money toward your goals. You may feel guilty about spending on some of the things that bring you or your family joy, but those small luxuries likely don't break your budget. "I get tired of the 'Stop your Starbucks latte habit' [advice], because in reality it's not people's fault," says Laura Lynch, a CFP and founder of The Tiny House Adviser. "The structures around us have created an expectation of a lifestyle that is increasingly becoming unreachable for folks." You're better off focusing on the major tentpoles of your budget, experts say: Housing, transportation and food costs. Marcos Segrera, a CFP and principal at Evensky & Katz/Foldes Wealth Management, calls these the "Big Three," and attacking them may involve some creativity. "This might mean refinancing a mortgage, choosing a more fuel-efficient or used car, or embracing meal planning to cut down on food waste and expensive takeout," he says. You may want to consider outside-the box solutions to lowering your housing costs, says Lynch. "Co-housing, tiny homes, [accessory dwelling units], multi-generational ownership are all ways to share expenses, resources and create wealth," she says. It's easier to fund your financial goals — paying down debt, building an emergency fund, investing for the future — if there is more money to go around. So "one other piece of advice I have here is to not just focus on expenses, but think more about growing your income however possible," says Brady. "Again, it is easy to say but harder to do this." Boosting your income may mean asking for a raise or finding a different job altogether. Workers who switched companies in May earned an average pay bump of 7%, according to data from ADP. It may make sense to look for inexpensive ways to increase your workplace skills or to familiarize yourself with emerging technologies, such as AI, Brady says. You may even think about picking up a side hustle. You may find it less difficult, in the end, to bring in more money than to cut back on what you provide for the people you love. "Look at both sides, not just spending," says Brady. "Because with a young family, that might be hard to change."
Yahoo
26-05-2025
- Business
- Yahoo
About 1 in 4 Americans are "functionally unemployed," researcher says
While the unemployment rate remains near a 50-year low, another measure of worker well-being indicates there may be bigger cracks in the labor market. The low unemployment rate, which stood at 4.2% in April, has signaled to economists and investors alike that the U.S. economy remains relatively healthy. Employers are also continuing to hire despite headwinds like tariffs and plunging consumer confidence. But another indicator suggests those pieces of government data may be painting an overly rosy picture of the economy, with a recent report from the Ludwig Institute for Shared Economic Prosperity (LISEP) finding the "true rate" of unemployment stood at 24.3% in April, up slightly from 24% in March, while the official Bureau of Labor Statistics rate remained unchanged at 4.2% over the same period. LISEP's measure encompasses not only unemployed workers, but also people who are looking for work but can't find full-time employment, as well as those stuck in poverty-wage jobs. By tracking functionally unemployed workers, the measure seeks to capture labor market nuances that other economic indicators miss, such as Americans who are left behind during periods of economic expansion. "The unemployment data, as it's put out, has some flaws," LISEP chairman Gene Ludwig told CBS MoneyWatch. "For example, it counts you as employed if you've worked as little as one hour over the prior two weeks. So you can be homeless and in a tent community and have worked one hour and be counted, irrespective of how poorly-paid that hour may be." LISEP, in a working paper on the gauge, says the measure prevents part-time jobs or poorly paid work from being counted as equal to full-time and better-paid work. LISEP also argues that the unemployment rate "presents a very incomplete and, in many ways, misleading picture." In other words, people who lack steady work and don't earn living wages shouldn't be counted as functionally employed. Its True Rate of Unemployment (TRU), which began tracking the measure in 2020, encapsulates workers whose earnings don't allow them to make ends meet, and are struggling just to get by, according to LISEP. "If you're part time and can't get a full-time job, then we count you as functionally unemployed," Ludwig noted. "We also count as functionally unemployed people who don't earn above a poverty wage." "Survival mode" In so doing, it counts workers who can't afford to put roofs over their heads, can't procure nuturious meals and don't have the ability to save as being functionally unemployed. "You don't have anything that gets you to the first rung of the American dream ladder. You're in survival mode," Ludwig said. When broken down by race and gender, TRU shows Hispanic, Black and women workers faring worse than White workers, as well as men. More than 28% of Hispanic workers, and nearly 27% of Black workers are functionally unemployed, compared to 23% of White workers. And more female workers — 28.6% — are functionally unemployed than male workers, whose true rate of unemployment stands at 20%, according to LISEP. Millions of households are currently struggling to maintain a "minimal quality of life," according to another recent analysis from LISEP. Its research found that the lowest-earning Americans around the U.S. are falling well short of what they need to maintain a decent standard of living. These households earned an average of $38,000 per year in 2023, but would need to make $67,000 to afford the items the group tracks as part of its index, which also includes the cost of professional clothing and basic leisure activities. The wide chasm between the the BLS's measure of unemployment and its true rate of unemployment is also concerning, according to Ludwig. "If you say there's 4.2% unemployment, which makes political folks happy because it's a low number, it causes all kinds of poor policy decisions and assumes we are better off than we are," Ludwig said. "There's less energy and less of a push to improve employment, and the people who get hurt at middle- and low-income Americans." Delta Air Lines' 100th year takes flight 9 young siblings killed in Israeli airstrike in Gaza Full interview: Jack McCain on "Face the Nation"
