For those who have been doing their best to find employment after being fired or laid off in our still-struggling economy, having to deal with credit trouble, be it recent or long-standing, can be especially difficult. Debt trouble and a damaged credit trouble not only raises the stakes of landing a new position-it can also make securing fresh employment far more challenging.
Going by current consumer debt numbers, while the economy is continuing to struggle, many are still taking on student loan and auto loan debt. The thought is that as the economy continues to improve, consumers will once again feel confident enough to take on credit card debt.
In our current economy, we all know it can be rather hard trying to find a new job. Unemployment rates are high and many companies are in the position of cutting back instead of adding new jobs. This in turn has led to many falling behind on bills and many others losing their homes to foreclosure.
Last week there was a higher than anticipated number of people who filed for unemployment benefits. In fact, there were 374,000 jobless claims for the week ending Aug. 25. This leads some to believe that the labor market is continuing to not do too well in an already struggling economy.
As we've talked about in the past, consumer demand largely dictates the market. This means if people's buying choices change, companies and businesses that were once thriving can end up in tough financial situations continuing to go further and further into debt. This in turn can end up leading to lay-offs, which directly affects employees.
After the recession, out of economic insecurity many consumers stopped relying on credit as much. And while this is certainly still true for some, according to the Federal Reserve's monthly credit report, revolving debt -- which is mostly comprised of credit card debt -- rose to $870.2 billion. This represented an $8 billion increase from the previous month.
Following a national trend, personal bankruptcy filings were down for the first four months of the year. Of course, while some are pointing to this as a sign of the downward economic trend finally starting to turn around, others are staying cautious as extended unemployment benefits are expected to be phased out and banks are once again initiating foreclosures.
There's no denying it: Times are tough for many residents in Florida and all throughout the country. With unemployment rates still very high and the percentage of people living in poverty on the rise, many may be worried and looking for some sort of financial relief to stave off foreclosure and deal with accrued debts.
Every month since September consumer spending in the U.S. has been increasing. And while this may be taken as a good sign that people are once again starting to feel more financially confident since the recession, this uptick in spending may also be linked to people having to rely on credit to pay for every day expenses.
People that have been unemployed for some time are slowly getting back to work. However, for some people the damage to their finances has already been done while they were out of work and now they are looking for debt relief to get back on track.