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Fed programs supply $2 of $10 in income

July 11, 2011 at 11:22 AM   |   Comments

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WASHINGTON, July 11 (UPI) -- Money through jobless benefits, food stamps, Social Security and disability accounted for nearly $2 of every $10 Americans got in 2010, an analysis said.

The Moody's Analytics report also indicated many of those dollars would disappear by the end of this year with the expiration of extended benefits meant to help people cope with the lingering effects of the recession, The New York Times reported Monday.

Moody's Analytics estimates $37 billion will be extracted from the nation's wallets this year, slightly less than spending cuts Congress enacted to keep the government financed through September to avert a shutdown.

"If we don't get more job growth and gains in wages and salaries, then consumers just aren't going to have the firepower to spen, and the economy is going to weaken," said Mark Zandi, chief economist of Moody's Analytics.

Job growth remained difficult, with 4.6 unemployed workers for every opening, the Labor Department said. Friday's unemployment report showed employers added only 18,000 jobs in June.

While some of that growth was in Social Security and disability benefits, the majority of federal payments went to people still suffering from the recession, Zandi said, with unemployment benefits more than three times their pre-recession level.

© 2011 United Press International, Inc. All Rights Reserved. Any reproduction, republication, redistribution and/or modification of any UPI content is expressly prohibited without UPI's prior written consent.
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