The 'White Collar' Recession is Pummeling Office Workers (fortune.com) 211
White-collar workers are facing their deepest hiring slump in a decade, with one in four U.S. job losses last year hitting professional workers, according to S&P Global. A 2024 Vanguard report shows hiring for employees earning over $96,000 has fallen to its lowest level since 2014. The downturn has been particularly severe for job seekers â" 40% of applicants failed to secure even a single interview in 2024, according to a survey of 2,000 respondents by the American Staffing Association and The Harris Poll.
Technology and high interest rates appear to be driving the decline, with companies reassessing their workforce needs amid AI adoption and economic pressures. While hiring remains steady for those earning under $55,000 annually, the market continues to be especially challenging for mid-career professionals and higher earners.
Technology and high interest rates appear to be driving the decline, with companies reassessing their workforce needs amid AI adoption and economic pressures. While hiring remains steady for those earning under $55,000 annually, the market continues to be especially challenging for mid-career professionals and higher earners.
Jobs available, yes, good, no (Score:2, Insightful)
Re:Jobs available, yes, good, no (Score:5, Insightful)
The problem with raw job numbers is they frequently don't include details such as compensation and sector. If you want to work in the service industry (food, hospitality, etc) jobs are available. Tech or professional positions not so much.
The headline stated "white collar jobs." Service industry (food, hospitality, etc) jobs are not white collar.
https://www.merriam-webster.co... [merriam-webster.com]
Re:Jobs available, yes, good, no (Score:5, Insightful)
Article also said "...with companies reassessing their workforce needs amid AI adoption and economic pressures."
Are those the same "economic pressures" where businesses are reporting record profits and/or spending billions of dollars on useless stock buybacks?
Re:Jobs available, yes, good, no (Score:5, Informative)
The more inflation there is, the more businesses have to pay their workforce. The more inflation there is, the higher minimum wage. The more inflation there is, the higher things will cost, the more inflation there is, the less likely stocks will go up.
So the pressure is to try things like fake AI, which will only come in and steal your IP, while you attempt to use it for customer service, which will fall and less people will use your service.
Remember when they shipped tech support jobs over seas and they had a brain drain as well as less benefit on feedback on what was going on with their products, so they brought them back to the states?
Same thing will happen here.
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In principle, yes. But because of the current very top-heavy arrangement of the US economy, wages have a very big gap to catch up with consumer inflation and real estate inflation.
People know they need more money to make up for the greater expense of everything, but actualizing it through changing jobs relies on a competitive employment market, which does not exist.
I feel like the crisis this represents is historic in scope, but that's purely intuition.
Re:Jobs available, yes, good, no (Score:5, Insightful)
the less likely stocks will go up.
This is the answer. Executives are looking for get rich quick schemes, which means they need a way to pump up their stocks. They are desperate to do this. That's why they waste so much money on stock buybacks, even though they know that buying back 1% of total capitalization won't move the needle on the stock.
They're so desperate that they are willing to try private equity schemes to gut the company in exchange for a short-term pump to the stock price. Cut people, projects, programs, orgs. Doesn't matter what you cut; the stock will go up.
The other private equity scheme is PR. Say you are chasing the latest fad. That's why all companies say they're investing in AI, even though they don't know what that means.
Re:Jobs available, yes, good, no (Score:5, Interesting)
The current buy-a-politician scheme in the USA, means it is not possible to hold billionaires accountable.
It's even more fundamental. To become a politician in the U.S., you have to be rich. Fighting an election is an business, where you have to put up enough personal wealth at first, before you can even try to convince potential donors to invest into you. 99% of U.S. politicians are members of the 1%, and they support policies for their own kind.
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Really? So Bernie Sanders, and AOC, and Tlaib, and othes are rich?
Re:Jobs available, yes, good, no (Score:5, Insightful)
> So Bernie Sanders, and AOC, and Tlaib, and othes are rich?
So you pick the outliers, and not the rule? Lol.
Next you'll be telling me that fish don't swim in water because McDonald fish filet exists and THEY are on land.
Truth is in national and even state politics you will MOSTLY find the rich.
In the 115th Congress the combined wealth of all members at that time amounted to at least $2.43 BILLION, marking a 20 percent increase compared to the preceding Congress.
So they DON'T have any money? LOL. You are delusional. MOST of them are RICH. That averages out to $243 Million per senator.
The tendency of the rate of profit to fall (Score:2)
In simple terms, a recession occurs when economic output declines from one period to the next. If your nation makes cuts its labor force, then eventually that decline in production will bubble up into economic reports.
During a recession, some people have little choice but to take a standard of living cut. This of course isn't directly reflected in the business that once employed that person. But when cuts are occurring over a broad portion of the population, the can show as a cooling off in consumer spendin
SkepticalGPT (Score:2)
I'd like to see real samples of jobs AI allegedly replaced. Maybe spammers, but we don't consider those real jobs.
Sounds like co's use AI as cover to lay off rather than admit their biz is just in a slump.
Re:SkepticalGPT (Score:5, Interesting)
I am currently tasked with developing content for AI to replace my position, I am hoping to get the opportunity to implement it
Re:SkepticalGPT (Score:5, Interesting)
I work at a relatively small, highly technical company that relies on a software that usually requires an entire department to support. I am one of three people who do everything from daily end user support to implementing projects for new features.
Almost 80% of what I do could be handled by automation, but our end-users who are freakishly talented and paid to do the science-stuff the company relies on, would hate it since we really "grease the wheels" and make their lives easier.
The very likely outcome is that we can get AI to behave human enough to handle most human interactions, allowing the team to implement new versions, etc which are needed. I feel that if I pass on this I will miss a transformation in IT and lose future career opportunities if I want to work past normal retirement age, which I plan on.
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Yep. At the beginning of the current AI hype, I thought that LLMs could at least do simple bureaucracy reliably and that would have cost a lot of jobs. But LLMs apparently cannot even do that. The only jobs lost seem to be from other causes and then lying about it.
High Interest rates are here to stay (Score:5, Insightful)
The only way interest rates are coming down in the near future is if there's a recession or if the fed chairman is replaced by someone really irresponsible, and the likely outcome of that is bad. Tariffs increase inflation. High interest rates fight that. Cutting taxes massively when the economy is booming invites a lot more inflation too.
Perhaps companies will eventually end up hiring more people after the ai thing is reassessed. That's what everyone is saying isn't it? No labor-saving technology actually results in job loss in the long term - people just use that labor saving tech to create new jobs!
I think people who say that are the kind of people who forget how complex history can be. During industrialization, for example, in India, the labor saving textile technology of the British took away all the old weaving jobs of Indian people, but they weren't replaced by new jobs in India, they were replaced by new jobs in Britain. Not good for people in India.
We will see...
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US is a consumer-driven economy and recessions occur when people are not buying
People who fear losing a job, or who have to take a position that pays less money are less likely to spend money
This is already being seen in the housing market stagnation where houses with high value are not being purchased due to high interest rates
It will become a recession when it hits new cars and other durable goods
All I can say is, start socking away some cash now, because you will be able to pick up properties on the chea
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US is a consumer-driven economy and recessions occur when people are not buying
We are gonna find out how true that is in the next couple months...
US Retail Sales Plunged Along With Temperatures in January After a Bustling Holiday Season [cnn.com]
Re:High Interest rates are here to stay (Score:5, Funny)
Cutting taxes in itself won't affect the economy much. The biggest bang out of tax cutting came with Kennedy, Reagan tried it but then he increased the deficit spending, and the U.S. was just figuring out how to get out of the oil embargo. So the economy got better. What will increase inflation is that the tax cuts are they are talking about are only possible by increased deficit spending.
Picture how el Bunko ran his companies. He bankrupted 3 casinos. His alleged "real estate" company was convicted of fraud in New York, it seems the only thing he built was cooked books. Anyone remember el Bunko University? It too was convicted of fraud. His social media "company" just announced they lost $400 million in the last year. That's $400 million in other peoples' money he and his cronies have stolen. Sooner or later, it will declare bankruptcy, and he'll be in his happy place. The tat he's selling from the Oval Office now hasn't been built. He waits until they get enough orders and then radios his Chinese manufacturers to make something. And the small print in his ad copy says you cannot rely on when it will arrive or even if what you bought is what will be delivered.
Now picture a U.S. run like one of is alleged companies.
Fuck the market, Trump wants lower rates (Score:2)
Sounds like it'll be happening some time in the next few weeks, then.
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What do you do with your money when you think there's going to be 44% inflation, but the stock market is overvalued and gold (which has gone up 42% in one year) is also overvalued?
I guess real estate and commodities?
Just a popped bubble (Score:5, Interesting)
It's not AI, it's just the VC bubble that popped.
The economy was being supercharged by massive amounts of venture capital being poured into new companies, most of which failed (as most new companies do, but when you add more money, it creates more new businesses, which creates more failure). Most of these companies were white-collar.
Since more money was being dumped into businesses, they had to hire more workers. So they created a market for new (additional) white-collar employees.
Now that the VC money has dried up (they finally decided to stop burning money), so has the extra businesses, and thus jobs.
But those additional white collar workers are still hanging around looking for nonexistent jobs. I know multiple people who know absolutely nothing about tech, and were never interested in it, but figured "well I can just get a job in tech, that pays well" and are spending money on bootcamps right now, for shit like "data engineers". They're never going to get a job. But they'll continue to be unemployed and applying for these positions, because they hope the gravy train will come back. (it won't)
AI has nothing to do with it (Score:3)
On the other hand, midlevel workers are definitely under threat. Yeah, a lot of tasks that could be done by someone with mid-level math, science, or writing skills can now be done 3 times as fast with chatGPT. The number of those workers will shrink.
So the current job market trends are definitely NOT being driven by AI. More likely, it just that we're on the front edge of a recession and companies are finding it easy to lower wage offerings.
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Au contraire, LLMs are quite good at creating bullshit. It is basically the only thing they can do well.
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So somebody with "skill" and "experience" that actually can solve problems but is somewhat lacking in character and "decency" (whatever that means) is a "bullshitter" in your book?
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But what it's probably doing is replacing entry level knowledge workers. And the new ones aren't going to learn the same knowledge that the older ones developed. They'll learn different things. I don't think you can make a blanket judgement of better or worse. Is it better to write to a compiler language than it is to write to assembler? But there are problems that can only be understood at the assembler level. Similarly there are going to be problems that most of the incoming folks will never learn t
This is by design (Score:3, Insightful)
That's because the way they work is companies are in a constant state of cash crunch. Nobody just leaves money sitting at a company. The owners take it out for themselves. A handful of large companies have cash on hand but it's there for stock buybacks in order to maintain the stock price during downturns like this one.
When borrowing is cheap They borrow during cash crunches, when it's expensive to borrow they fire you. Then you blow through your savings and take a lower paying job out of desperation and that's supposed to reduce inflation by reducing demand.
Basically if you work for a living you're the whipping boy here.
Keep in mind if you stop and think for a second this doesn't actually work. The cause of inflation is either a lack of competition and failure to enforce and he trust law or a shortage of a good or service. Getting you fired isn't going to solve either of those problems. If anything it's going to make the supply shortages worse because your productivity is going to go down. Although on paper it's supposed to go up as you work harder to desperately survive... In practice if companies could get more productivity out of you they'd be doing it.
What this actually does is crash the economy so that the rich can steal your house when the bank takes it.
The way we get out of inflation is always been the same. If the problem is shortage is, and it's not right now, Scientists come along and invent a bunch of new shit that increases productivity and we start using it and productivity goes up for real.
If the problem is anti trust law we start enforcing it..
And if we refuse to do either of those two things either because we keep cutting funding to science or because we keep electing corporate ghouls who push our buttons with moral panics and social issues, well the way it gets solved is a nice big world war or a plague that kills about 30 to 50% of working age adults.
It looks like we've chosen plague this time given who we just put in charge of HHS. I guess it beats accidentally hitting on a trans girl though...
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That is a price hike, it is inflation.
Oh no, you said the magic phrase! Now the "libert"arians will come out of the woodwork and tell you that it's not inflation, because they don't know the fact that monetary inflation (devaluation of currency by issuing more currency, causing a decrease in buying power) and price inflation (a broad-based rise in the cost of goods and services, causing a decrease in buying power) are both things which exist.
Re:This is by design (Score:4, Interesting)
I don't disagree about tariffs but it's not like everything with the economy turned sour the moment trump was elected the second time. The economy has been unhealthy since since 2008 at least. a collapse has been long overdue and postponed repeatedly by all manner of tricks.
Re:This is by design (Score:5, Informative)
You are engaging in denial and hand waving
The global economies collapsed in 2008 [wikipedia.org], after years of the US economy supporting an unsustainable real estate market, and tanking the planet when the eventual market readjustment occurred
Obama attempted to stimulate the economy, while Congress worked to limit the amount of spending and the Treasury kept interest rates low [brookings.edu], which kept the debt from ballooning as a result of Presidential and Congressional behaviors.
Trump added to the debt, while reducing tax income with the help of republicans in Congress [americanprogress.org] and Biden paid for it by having to spend his terms battling inflation, which had been going down for 36 straight months [usinflatio...ulator.com] leading into Trump's second term
Trump's statements before his send term and behaviors since have had direct and negative effects on the global economy, and I will be surprised if it is not harkening another recession
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The economy never recovered after 2008. Aside from whether Biden could have really done anything about inflation as president, the notion that it got better during his time is pretty laughable. Trump can do plenty of damage but some the perceived accelerated decline from here will be due to the general realization of how unhealthy the economy already was. We get headlines about "hot" CPI over 4% or 5% when anyone who's been to a grocery store knows it's far worse.
I never defended Trump, I am telling you it
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Like I said, Denial
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>The economy never recovered after 2008.
You are going to have to put some stats and definitions of "recovered" behind that before I BEGIN to believe you.
Is under 3% employment good or bad?
Is 16M+ Jobs good or bad?
Is increasing infrastructure projects in the US good or bad?
Is a gas price lower than 2019 good or bad?
>I never defended Trump, I am telling you it was already bad.
So? Really "it was already bad" How so?
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"You are going to have to put some stats and definitions of "recovered" behind that before I BEGIN to believe you."
The major holes blamed for the 2008 collapse, such as hedge funds (granted they are no longer as profitable as they were), derivatives, and subprime loans, were not patched. Dodd-Frank, which was already toothless, died under Trump with the democrats' help in 2018. The the SEC's corruption and lack of real oversight around insider trading also has not changed and is in fact as flagrant as ever
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Wrong, Trump's policy are about addressing the wealth gap.
While yes American's do pay the import taxes, the point is to trigger retaliation by other countries. America produces a lot natural resources and farm products and far few finished goods than we once did. What we need to do is to make food and energy cheap. That is how you help the bottom of the latter. Guess what China is already threatening to retaliate on American food stuffs, USAID isn't buying to send it abroad.
yes in the very short term big
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Yup. They are crying in Instagram. Boo Hoo.
They voted for this now they are FAFO.
Yet they still think he's doing the right think in his other wars against OTHER people they don't like. They just don't want it to affect them. If only the government would just buy all their stuff and destroy it to drive the prices up or something.
They are so selfish and undeserving.
We'll see how many faces the leopards get this time.
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It's everyone's faces. The more farm consolidation, the more processing consolidation, and the more food-borne diseases are spread with fewer alternatives available.
Re:This is by design (Score:5, Insightful)
Wrong, Trump's policy are about addressing the wealth gap.
By further widening it.
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yes in the very short term big ag will try to price their way out of seeing their bottom line squeezed but it won't work, past a few months the consumer will be tapped out, demand will fall. They will realize they have so much grain they can't give that shit away to public. Domestic staples get cheap.
No, the specific grains and pulse crops which are exported get cheap, most meat and fruits and vegetables stay the same, some fruits and vegetables get a lot more expensive, everything out of season is going to be really, really expensive. The overall effect will be higher food prices overall, with wheat, corn, and soy products primarily costing a little less to manufacture, they are already pretty cheap, around $2/kg at the consumer level, the impact of them getting cheaper is limited. Whether grocery stores actually sell them for less is up for grabs, most of the food inflation is in their profits.
Meanwhile food prices get persistently higher in places like China, which is good because it destabilizes our competitor.
That would be valid if the US were the only seller, or if China couldn't grow good themselves. Unforunately, that isn't the case. They can get everything they need from other sources. We represent 25% of their agriculture imports, not 25% of their total food available. China produced $1.1 trillion of food, and imported another $130 billion, the $33 billion they imported in US agriculture is only 2.6% of their food, it wouldn't make much difference even if most of it wasn't easily replaced buying elsewhere.
It's pretty obvious that this tarriff plan was never going to work the way you claim. This is why pretty much every reputable economic analysis stated this was a terrible idea, and would only hurt the US.
Libertarian rehash of trickle down economics that has never, ever worked anywhere, anytime
The world does not work this way, this is not the endpoint this plan is heading for. Self isolating oligarchies don't go well.
Re: This is by design (Score:2, Informative)
High interest rates encourage people to save, and savings creates more secure jobs.
Low interest rates cause malinvestments and create false jobs.
Read Mises, Rothbard about the business cycle. Itâ(TM)s all because of low rates and bad investments.
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Crunch is stupid. It decreases profits. But yes, if you want to feel like a real boss that tortures their underlings, then crunch is the way to go.
Technology to replace the people (Score:5, Funny)
"The rise of workers’ leverage appears to be on the horizon"
Halleluja! Just over the horizon. A little further over. Don't mind that cliff, keep moving towards the horizon.
"It’s too early to tell how the volatility of President Trump’s administration will impact this all [..] but from simply a business productivity lens there’s hope of greater federal investment into the economy."
I look forward to hearing how pouring federal money into billionaire's feeding trough will make the business productivity lens more rosy.
Re:Technology to replace the people (Score:5, Insightful)
"I look forward to hearing how pouring federal money into billionaire's feeding trough will make the business productivity lens more rosy."
1. UUUGE tax cut for the super rich
2. The super rich can't actually use this money to buy anything and trickle down the wealth because they already have all they want so they buy back stock in their companies instead.
4. This will be great for the stock market! There will be some record days ahead! Yahoo! If the stock market is doing well whose complaining about the economy?
6. These rich people are GENIUSES so the more money they have the more they can build GREAT AMERICAN COMPANIES that solve all our problems.
7. If the government is bankrupt we can sell off and privatize things like the highways and the military, hell, why not sell off the administration of whole towns and cities to the elite? Maybe this will create jobs somehow? Probably will.
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Always Worthless (Score:3)
These generalized reports are always worthless, because they are so specific and localized.
Working as an industrial control engineer, making well north of the $100K from the article, I have needed to turn away headhunters as recently as today, and she was not even the second this month. High-end process control work is comfortably white collar, is something in demand in more or less all localities and something that generally cannot be outsourced because of the need for on-site presence during startups and for troubleshooting. Demand is always growing, and even through I am in my middle 40s, only work with 2 or 3 guys younger than me, not enough new people getting into it.
Tell your kids to leave web stuff to other people, study a combination of computer science and electrical engineering, nurture at least some interest in mechanical or chemical engineering, and away you go.
Symptoms (Score:2, Interesting)
The current situation seems to be symptomatic of a root cause that has worked far more mischief than simply wrecking the white collar job market.
It started in 1913 when the 2nd biggest mistake produced by this continent (the 1st was slavery, but this country did what no other country in the history of mankind has been altruistic enough to do, we fought a war to end that evil) we passed the income tax as the 16th Amendment. Given enough time, it has created the rust belt by making manufacturing too expensi
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Trend to flatten org structures (Score:3)
Re:Poor savings habits strike again! (Score:5, Insightful)
60's here, steady high-5 low-6 figure income
Rolled everything into a telecom I worked for and lost it all, worked for company with a full pension that cut it short and riffed me when investments in real estate almost sunk the company. Currently saving as much as possible and considering jumping over the local government to get a pension there as well.
I have seen people strive their whole career and then get downsized, with little recourse for another position and put a bullet through their head the same afternoon
Your lack of empathy borders on psychopathy, get help
Re:Poor savings habits strike again! (Score:5, Insightful)
This is why things like Social Security are important and necessary. Yes we can yell about personal responsibility until we are blue in the face but people are famously irrational and situations as you describe are not uncommon at all. In the 1920's this fact that people past working age had no money affected everything else, it's a big drag on the economy to have the retired age group poor or relying on their families, thus the SSA is borne.
Forced savings by whatever form it takes is a necessary thing, people are just not gonna be responsible enough to do it on their own, it's a bit of a privilege to be able to financially plan decades into your future, to not have to choose between saving for retirement or paying your mortgage today. The failure of the 401k system is testament to that as well. [economicpo...search.org]
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Re:Poor savings habits strike again! (Score:5, Interesting)
Remove all high paying jobs, and social security and medicare will implode. Social security and medicare is a pay as you go system. People working now are paying into the system to support those in retirement. Everybody working low paying jobs because of the death of white collar jobs will reduce the amount of social security medicare axes being paid into the system.
If social security and medicare do go away, you'll see one or more of the following occur:
1. The elderly will have no choice but to become dependent on their children (If they have any) and will move in with them.
2. There will be more elderly dying on the streets.
3. Euthanasia (via physician assisted suicide) of the elderly will become an option in some states.
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Yes this is important, I used the term "forced savings" colloquially but despite common thought nobody "pays into" Social Security, like the dollars that came out of my paycheck this week are not the same dollars I will get in another 20-ish years, those dollars will come from yours and my kids paychecks. Your money is not guaranteed, it's an institution, we have to support it to keep it (also remove the contribution cap).
Re:Poor savings habits strike again! (Score:5, Insightful)
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or you know we could just cap benefits, such that they are also calculated based on 166,000 and whatever inflation adjustments we want to add.
High earners in theory needed more SS income to cover the cost of up keep on larger homes, life in higher cost of living regions etc. However these same people are the ones who are best able to save and plan for their financial futures and they have more options than ever in terms of leaving their high costs areas when they retire, downsizing homes etc.
There is no rea
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Sorry, it should be implied that by removing the cap it goes hand in hand with capping benefits. Fact is the SSA will need more money to maintain payouts amongst a declining population (and if we now don't want immigration in high enough numbers to maintain something has to give) so high income earners contrinute more but get their same contribution.
It may not be "fair" but alas if you are over the cap chances are you are already in the highest bracket as you said you are in fact doing fine and marginal ut
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JFC. We're in a lot of trouble if this kind of thinking is common.
I've been ordering off the senior menu for a while, so this isn't about ageism.
Re:Poor savings habits strike again! (Score:5, Insightful)
or you know we could just cap benefits, such that they are also calculated based on 166,000 and whatever inflation adjustments we want to add.
You really didn't know that benefits are already capped? I've paid the max into Social Security for 47 years, and continue to do so because I'm still working full time. I've received the capped maximum since I started receiving the benefit.
That's going to end soon, though, as soon as Musrump implements means testing for Social Security recipients. Just because you've paid into the system all your adult life doesn't mean you are entitled to the benefits you earned. That money is needed to pay for tax breaks for the wealthy, after all. The fact that Social Security is "the third rail of politics" doesn't matter if elections are suspended due to a perpetual state of emergency.
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If SS goes away due to messing around by those currently in power-- most people will lose everything. And you'll probably lose most of your investments too. That is, unless you're in the inner circle of power in the current federal government. Then you might a supply of dollar bills with special treasury stamps backed by gold or some other scare material. (Remember those dollar bills stamped with a red treasury stamp)?
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4. people become inmates (at an much higher cost to the state then medicare)
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This ends up being #3 indirectly. The state won't provide a level of care which prolongs the life of the elderly who choose to commit a crime to be cared for. It's not in their interest and they would want to make it the least desirable option. Have you ever witnessed nursing homes where they send the elderly with no assets? They don't last long in one of these. Prisons would be much, much worse.
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There are a few other choices:
Raise the retirement/pension age (People won't work more years, they just won't get old-age benefits.)
Remove limits on taxation (Currently, USA makes taxes a fixed cost for billionaires.)
Make the millionaires and billionaires pay higher taxes
The current buy-a-politician scheme in the USA, means it is not possible to hold billionaires accountable.
Easy solution to that problem (Score:3)
Not that I don't think we shouldn't have more high paying jobs. But it's not the only solution we have.
On the other hand the solution we seem to be going with is that in a few years we're going to shut down Medicaid and Medicare and just start letting people die. The elderly aren't going to become dependent on their children because they screwed their kids
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165k is 94% income percentile.
I think your data is out of date. This, according to Investopedia: [investopedia.com] In 2021, the nationwide bottom of the top 5% was $253k, and the average was $336k. $165k didn't quite get you into the top 10%.
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Removing the cap will generate enough to refund the Social Security Trust Fund which is what you hear about when people say SS is going "bankrupt", the Trust Fund is the extra revenue generated not the primary funding so when that runs dry SS doesn't go away but benefits will be reduced by some-odd 20% as I understand it. If that's something we want to avoid that should be an option on the table.
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Your first sentence is not true. Once your earnings exceed a specific amount, you can stop paying into Social Security for the rest of the year. For 2024, the Social Security tax limit was $168,600.
Source: https://money.usnews.com/money/retirement/social-security/articles/what-is-the-social-security-tax-limit [usnews.com]
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You left out 4. Elderly crime wave. If you're old, but you've got a gun, that levels the playing field somewhat.
401k was a success, for the elite. (Score:5, Insightful)
That was an interesting paper you linked though I confess I only read the summary. The upshot is "the 401k system has failed to provide participants with sufficient retirement savings by the time they hit retirement age." So, that's why it has been pronounced a failure: the people who used it, as instructed, have reached retirement age with too little money to retire.
Well, that assumes that helping people to retire was ever the goal. It certainly was the ostensible goal. But remember that it was rolled in right at the same time that pensions were rolled out of the private sector. Companies were downsizing like mad to deny current employees any further vestment in their pensions, and of course killing the policies. The 401k was presented as an alternative.
Why was the country's economic leadership united in this action? Was it because they honestly believed that the pension system was letting people down, and this 401k system would make all their employees be better off? If you believe that, I have a bridge to sell you.
The pension was an excellent deal for employees, which is exactly why employers axed it. It involved too much money trickling down from the wealthy to the working class. They wanted more of that money to trickle up. So they replaced it with a system that forces you to purchase stock on an ongoing basis, thus sending your money right back up into the coffers of the wealthy who control most of the economy. The flow here is a little bit indirect, since 401k programs don't necessarily include stock in the specific company that one works for. But that wasn't necessary for the big picture. The groups that pushed the plans on us are in a different position than we are when it comes to the stock market. They are well diversified and can make trades and take actions that are unavailable to us (and that most of us don't even know about). So their wealth increases overall when our participation in the market increases overall, regardless of specifics.
So, the 401k plan worked beautifully. It distracted us enough that we didn't unify in political action against the dissolution of the pension plan, and it left us converting a big chunk of our wealth into stock holdings which wound up benefiting them overall.
The fact that it leaves many retirement-age people with too little money to retire is just a side benefit. Keeping them in the workforce longer helps keep salaries down overall.
So, from their perspective, it was a supreme success.
Aside: despite the greed and evil on display here, stock investing (wisely) is still the best option for wealth accumulation for us. It benefits the upper 1%, but it also benefits us (more than just regular old interest would). This is still the best deal in town, even if it is a deal with the devil.
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It benefits only those who are well-connected. Given the attacks on the federal government by the current party in power, could trigger a constitutional crisis where blue fights blue -- The 1929 stock market crash and subsequent bank runs could repeat again. Those who are well-connected will have sold their investments and moved their money offshore or into precious metals.
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With the advent of memecoins, being able to move money and bypass FinCEN and SWIFT is becoming a lot easier. People would have their wealth in a coin (with knowledge of when to jump from one coin to another because the rug pull will happen at a date/time), while everything else winds up tanking.
The only real hope we have is that quantum factoring of ECC becomes just a feasible possibility, which will completely implode cryptocurrency exchanges as we know it.
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No pensions were bankrupting the private sector as people started to live to darn long. Then people either ended up a defunct pension or got shuffled on the federal guarantee corporation and also getting a tiny fraction of what they were owed.
It did not work!
but I will agree with you the 401k is the ultimate scam. It was done to turn Wall streets greatest unfunded liabilities (pensions) into giant slush funds that investment bankers could do whatever they wanted with as long as it had a thin veneer of fid
Re:401k was a success, for the elite. (Score:4, Informative)
First thought:
But the money was trickling up anyway- when the organization put money into a traditional pension fund, the money wasn't buried in a hole for 30 years, it was invested. Maybe invested in lower-yield but safer places, but invested nonetheless. So the wealthy coffers got their mitts on it either way.
...
Second thought is that traditional pensions had a serious design flaw. If the organization's part of the deal was just "pension pays X dollars after Y years", then the company had too much flexibility in putting seed money into the account. Eg:
- year 1: "based on a 3% annual growth rate, we need to put in Z dollars this year into the fund this year to keep pace with the target"
- year 2: "money's a little tight, but I think we'll get 3.1% annual growth rate so it's ok to put in less this year"
- year 3: "money's still tight, but the new tax laws will support a 3.2% annual growth rate. Let's put in less again"
- year 30: "they're retiring now, we'll go bankrupt if we actually have to cover the X dollars we promised. Federal government, you're our only hope!"
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The world you reference looks nothing like the one we all live in.
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So you started saving back when a house cost $30k? Run all that through the inflation calculator and get back to me.
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You said you "rolled everything into a telecom i worked for and lost it all" not trying to open old wounds, but that's called gambling. Having a lack of empathy towards people who gamble their savings away, or insist on having the latest and greatest of everything, take expensive trips all the time, etc. rather than save doesn't make someone a psychopath.
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The government did: Education, healthcare, rent (actually construction of roads, utilities and housing) were once subsidized by the US government. Then, they privatized infrastructure/housing, healthcare and adult education. Now, really rich people and really poor people get subsidies but US-ians complain about only one of those.
Teens should be taught this in school but 20-somethings rarely have the money to pay for being an adult (adult education, 'health' insurance, rent, car, childcare) and pay $6000/
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YeAh
ThEy NeED to STOp eAtinG AvAcAdo ToASt!!
Dude, you are so delusional. The Republicans and the rich have been F*ing us for what, 60 years over CuLTurE and the Dems have mostly stood by and quietly cleaned up after them, going oh well... but not rocking the boat too much - except in the CuLTurE war. THERE the Dems are all about standing proud. Poor people though? Nah. That really isn't their thing either.
And you Bootstrap it. Good for you. Well, I hope if you ever fall off a cliff you can get back up from
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Grandpa, run all your rosy figures through the inflation calculator https://www.bls.gov/data/infla... [bls.gov] and then get back to me.
Re: Poor savings habits strike again! (Score:5, Interesting)
Spotted the psychopath who had every bit of luck on his side and doesn't realize it.
He just has no empathy, period. Literally the worst type of person in the world, blames the poor for being poor, blames those who got ripped off for getting ripped off.
Bite me asshole. I had 2 different 401Ks drop to nearly nothing at different times. I diversified everything as suggested by financial advisers at the time, and I got to watch my $20K, plus my employers $20K drop to a grand total of $6K in the dot com crash. One fund went to actual zero, all the money was just gone. 2008, same thing, more money. Then the company I worked for went out of business in the recession, and no one was hiring. After 18 years of work, $16,000 of total retirement savings, less than one third of my contribution, zero of my employers match funds, zero in interest, not my fault, I didn't control when I entered the work force, and had no say in the economic bubbles.
I know a lot of people this happened to. The fact that you have no empathy for me or anyone else who didn't have your luck just shows what a remorseless, total prick you are.
Re: Poor savings habits strike again! (Score:3)
Re: Poor savings habits strike again! (Score:5, Insightful)
What a sad appeal for validation.
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What a lot of words to say "Got mine, fuck you".
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Reality is that you have to save for later, and most people don't. It doesn't matter how much you make, as long as you make enough to eat and have some left over, you have to save for the future.
If you don't, then either shit is so bad you can't see the point OR you're living beyond your means. Plenty of people live beyond their means and then are shocked when they retire to poverty. I'm not sorry for those people. They played a lifetime round of FAFO.
If you did your best to save and got fucked regardle
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>you have also been calling out for the outright murder of innocent palestinians for a while now.
Not even once.
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I, for one, have saved every chance I get, am approaching retirement age, and have nothing. I've had blue and white collar jobs but a combination of disabilities, my own mistakes (we all make them but people in my position don't recover) and misfortune has left me living hand to mouth on a wage too small to save on.
Hi Cheese. I'm now in my sixties. Look at the number of my member ID, and you'll see I have been on this website for a very long time.
Dave Ramsey (Author, Radio guy, podcaster, and personal finance guru) has made millionaires out of countless blue-collar and white-collar workers.
I'm not saying that his advice will work for everyone, but his methods work more often than not.
His books are free at your local library. He has hundreds of hours on YouTube. What he has to say may be more critical to your financia
Re:Cheap IT labor is to blame. (Score:5, Interesting)
And then you look at the comical-level ineptitude that the last few IT disasters (Crowdstrike, MS Exchange Online, etc.) had at their root and see that these cost "savings" are probably driving actual costs (for society) up and up.
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I think that I would choose a well programmed AI over Trump any day.
Heck I don't even need AI, I'd be happy with a "See and Say". It doesn't even need to be fully functional to be an improvement.
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I guess artificial Intelligence is better than none at all.
Re:Under Biden: For every 1 American job added (Score:4, Informative)