Bkprbob's Blog

School is to start in a few weeks. Teachers have been selected and given contracts. Emily did not get a contract. It must be a big disappointment for her to have graduated with honors in high school and college and yet not find work in her chosen field. She is a victim of the bad economy in that the new positions that were to open in a local school district were dropped for financial reasons. Some other local districts have cut their current staff leaving experienced teachers out of work.

She has been able to find work. She works for a hospice here in town answering the phone and doing light office work. She is glad to get a job as she has to start paying her student loans back. She was thinking of just putting her name in at various school districts to substitute teach but she wanted to have something more reliable. A friend told my wife of the opening at the hospice so Emily applied and got the job.

Emily was told that a teacher in our school district was going to retire after this school year. Emily plans to apply for that position. Hopefully things will get better as far as the economy goes and perhaps the positions that were to be added this school year will be restored next school year.

People are not spending like they used to. More and more people are losing their jobs. More and more businesses are closing. There is a domino effect in that if a business closes then it takes jobs with it and those workers have no money to spend at other businesses which could lead to more closings or bankruptcies.

The U.S. economy needs people to consume goods and services. We all live off each other. Many people are employed in jobs which are not essential to our basic needs of food and water, shelter, clothing, and heat. While the local fast food restaurant provides food we don't need it in that we can buy food from the grocery store and prepare it ourselves. The mall is full of clothing stores but most of us have enough clothes already and most of the stores in the mall carry high fashion clothing. A fraction of the total labor force is needed to meet our basic needs.

I think consumption has dropped greatly because of the recent rapid decline of wealth by those invested in stocks, bonds, and mutual funds. People have received their investment statements and saw their savings dropped by thousands. I think people are reluctant to spend as they want to build their savings back up. They are also angry that this has happened. Most all of us would have come out better if we would have sold our shares about a year ago and put the money in a simple savings account.

I think people will start consuming again if they see their savings begin to rebuild. If they are restored to near previous levels then more and more people will start buying more than just the essentials. Until this happens I think most of us will take our money and try to make up our lost savings and so spend mostly on the essentials.

Perhaps our leaders and those of other nations can bring hope and confidence to the people. I think this would go a long way in rebuilding the investment markets which would rebuild the savings that people lost. Once lost wealth is replaced then consumption should return to previous levels which should bring about greater employment.