Paul Ashworth, an economist with Capital Economics, noting real incomes for Americans have been stagnant since the 1970s, says the younger generation cannot afford big ticket items like buying a home. As MHProNews knows, many millennials are living with their parents because they cannot find jobs that can support a mortgage. He says, “The offshoring of relatively low-skilled labour-intensive manufacturing jobs matters because those jobs were, in general, better paid than the new jobs requiring relatively few skills that are being created in the education, health care and leisure sectors.” He adds that this globalization resulted in more Americans earning less, but they continued to take on more debt to achieve homeownership, and that in turn triggered the financial crisis. According to HousingWire, Anthony Sanders of George Mason University suggests as long as real incomes fall we will not be able to generate sustained economic growth, which could lead to a stronger housing recovery. He also states we got inexpensive goods by moving jobs overseas but at the expense of jobs that supported other sectors of the economy.
(Image credit: FotoSearch–question mark houses)