In this edition of Charts of the Week: Americans unable to pay rent; job loss contradicts GDP growth; and more children born to cohabitating couples.
ARE RENTERS CONFIDENT THEY CAN PAY RENT?
Jenny Schuetz analyzes new data on the probability of how many households think they will miss rent payments amid the pandemic. The question “How confident are you that you will be able to pay your next rent or mortgage payment on time?” yields answers that have a strong correlation with actual rent payment, yet they are not always accurate. The chart indicates that of the renters who reported “no confidence” that they would be able to pay rent, about 36 percent of them actually paid rent the following week. “One possible reason for why renters who are doubtful of their ability to pay future rent do not all default,” Schuetz explains, “is that many households who have lost income are cobbling together from several sources.” Families may be able to manage paying rent by relying on unemployment insurance benefits, running up debts, or borrowing money from family and friends, but, Schuetz warns, these are not long-term strategies.
JOB MARKET DECREASES AS GDP GROWTH SPIKES UP
Jay Shambaugh explains how to interpret the record-breaking increase in GDP growth for the third quarter of 2020, which belies the fact that the economy is still slowing down. As Shambaugh observes, there is still a large hole in employment and much of the increase in recent job growth is due to rehiring workers who had been on temporary layoff. The chart shows that permanent job loss has been on a steady increase and improvements will become harder to achieve. “The flashy GDP growth number for the third quarter is more a statistical quirk and reflection of the sharp dive and subsequent bounce in the spring,” he says, “not an indication of current momentum.”
INCREASING NUMBER OF CHILDREN BEING BORN OUTSIDE MARRIAGE TO COHABITING COUPLES
In A New Contract with the Middle Class, Richard Reeves and Isabel Sawhill look at different aspects of relationships of the American middle class and conclude that family life has been under more stress in recent years. As the chart indicates, more children are being born outside marriage, and more often to cohabiting couples rather than to single parents. “ Family stability – with few or no changes in parents’ residential and romantic partnerships – is associated with better educational and social outcomes for children – especially boys.” they write. ”Drifting” into parenthood, rather than planning it, often leads to instability in their relationships and in their families, they explain.