Walmart and the middle class, sinking together

From Rick Newman writing at Yahoo Finance:

It was once General Motors whose fortunes reflected those of the middle-class Americans who bought its products.

Now, that bellwether Goliath is Walmart.

The giant retailer has become a microcosm of the middle class, since both are mighty yet struggling, and both may be going even further downmarket...

The emerging “barbell economy” — growing clusters of high- and low-income consumers, with fewer in the middle — has driven many of Walmart’s customers either to higher-end department stores or to deep discounters such as dollar chains....

With Walmart tied so closely to the fortunes lower-middle-class Americans, it’s no exaggeration to say that, as goes Walmart, so goes America. And vice versa.

Like many struggling Americans, Walmart has plans to rejuvenate its performance and assure its relevance. It has invested more in its website and e-commerce infrastructure, to compete better with Amazon.

It also plans to open more small, neighborhood outlets that shoppers might visit for a handful of items, in contrast to the warehouse-sized stores that can take an hour or more to navigate.

There have even been rumors Walmart could buy a discount chain such as Family Dollar (FDO), giving it a sudden, large presence in the thriving lower end of retail.
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Link: http://finance.yahoo.com/blogs/the-exchange/walmart-and-the-middle-class--sinking-together

American dream seen as out of reach: new poll

From McClatchyDC.com:

Americans are overwhelmingly pessimistic about their chances of achieving and sustaining the American dream, according to a new Marist-McClatchy Poll.

They see an economic system in which they have to work harder than ever to get ahead, and a political system that’s unresponsive to their needs. They see the wealthy allowed to play by a different set of rules from everyone else.

Eight out of 10 Americans think it’s harder now than before, taking more effort to get ahead than it did for previous generations.

Just 15 percent think it takes the same work as it did before, and a scant 5 percent think it’s easier now.

And Americans don’t think it will get better soon, with 78 percent thinking it also will be harder for the next generation to get ahead....
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Link: http://www.mcclatchydc.com/2014/02/13/218026/mcclatchy-marist-poll-american.html

Jobless Claims Moved Up to 339,000 Last Week

From Bloomberg.com:

More Americans than forecast filed applications for unemployment benefits last week, underscoring the uneven progress in the labor market.

Jobless claims increased by 8,000 to 339,000 in the week ended Feb. 8 from 331,000 in the prior period, a Labor Department report showed today in Washington. The median forecast of 52 economists surveyed by Bloomberg called for a decrease to 330,000.
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Link: http://www.bloomberg.com/news/2014-02-13/jobless-claims-in-u-s-increased-to-339-000-last-week.html

WSJ: More Men in Prime Working Ages Don't Have Jobs

From the Wall Street Journal online:

More than one in six men ages 25 to 54, prime working years, don't have jobs—a total of 10.4 million.

Some are looking for jobs; many aren't. Some had jobs that went overseas or were lost to technology. Some refuse to uproot for work because they are tied down by family needs or tethered to homes worth less than the mortgage. Some rely on government benefits. Others depend on working spouses.

Having so many men out of work is partly a symptom of a U.S. economy slow to recover from the worst recession in 75 years. It is also a chronic condition that shows how technology and globalization are transforming jobs faster than many workers can adapt, economists say.

The trend has been building for decades, according to government data. In the early 1970s, just 6% of American men ages 25 to 54 were without jobs. By late 2007, it was 13%.

In 2009, during the worst of the recession, nearly 20% didn't have jobs.

Although the economy is improving and the unemployment rate is falling, 17% of working-age men weren't working in December. More than two-thirds said they weren't looking for work, so the government doesn't label them unemployed. The January snapshot of the job market is due Friday...
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Link: http://online.wsj.com/news/articles/SB10001424052702304027204579334610097660366

More weakness

From the Wall Street Journal online:

A hiring chill hit the U.S. labor market for the second straight month in January, reflecting employers' reluctance to take on new workers despite some of the nation's strongest economic growth in years.

U.S. payrolls rose a seasonally adjusted 113,000 in January after December's lackluster gain of 75,000 jobs, marking the weakest two-month stretch of job creation in three years, the Labor Department said Friday...

The confounding performance, particularly the weaker payroll gains, comes after months of mounting enthusiasm among many businesses, consumers and investors about stronger expansion.

It indicates growth in gross domestic product could be settling back near the 2% pace recorded for most of the recovery rather than the better-than-3% annualized gain in the second half of 2013...
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Link: http://online.wsj.com/news/articles/SB10001424052702304680904579368562158283286?