Business & Economy

On The Money: Lawmakers dismiss fears of another shutdown | Income for poorest Americans fell faster than thought | Net employment holds steady in September | Groups press Senate on retirement bill

by Sylvan Lane 11/05/19 04:51 PM CST

Happy Tuesday and welcome back to On The Money. I’m Sylvan Lane, and here’s your nightly guide to everything affecting your bills, bank account and bottom line.

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THE BIG DEAL–Lawmakers dismiss fresh fears of another government shutdown: Congress is preparing another stopgap funding measure to avert a shutdown later this month after little progress on spending negotiations, particularly regarding President Trump’s border wall.

The preparations for meeting a Nov. 21 deadline come amid increased tensions following Trump’s refusal on Sunday to rule out a shutdown. But key lawmakers said they are skeptical the president would trigger another lapse in funding after the record 35-day shutdown earlier this year yielded little in return for the White House.

Speaker Nancy Pelosi (D-Calif.) dismissed the likelihood of another shutdown, arguing Republicans would gain little from it. “I do think that they learned a lesson from the last shutdown since it didn’t do them very well,” Pelosi said in a Bloomberg News interview Friday.

“I don’t think there’ll be a shutdown,” said Sen. James Lankford (R-Okla.), a member of the Senate Appropriations Committee, in a local television interview Monday. “We have an initial deadline of the 21st of November, but if we don’t hit that then we’ll get an extension on top of that.”

The Hill’s Niv Elis explains why here.

LEADING THE DAY

Income for poorest Americans fell faster than previously thought: The poorest Americans saw their income decline 7 percent over the past 15 years, while everyone else gained financially, according to a new study.

Real income for low-income Americans fell more than 7 percent between 2004 and 2018, in part because of rising costs for items and services purchased by those Americans, according to the report published by the Groundwork Collaborative and the Center on Poverty and Social Policy (CPSP) at Columbia University.

How? The report focused on how rising prices can affect different income groups. The study found higher price increases for products typically purchased by low-income households.

“Given strong evidence that low-income families in America are paying higher prices and living in poverty in higher numbers than official metrics account for, this is a major problem,” said co-authors Christopher Wimer, co-director of CPSP; Sophie Collyer, a policy analyst at the center; and Xavier Jaravel, an assistant professor at the London School of Economics.

Niv breaks it down here.

Net employment holds steady in September as job openings drop: The number of U.S. job openings dropped slightly in September while net employment remained largely unchanged, according to data released Tuesday by the Bureau of Labor Statistics (BLS).

There were 7 million unfilled jobs on the last business day of September, according to BLS, 277,000 fewer openings than the last business day of August. The U.S. added roughly 180,000 jobs in September, according to revised figures released by BLS last week.

The unemployment rate also dropped to 3.5 percent in September, a 50-year low, though net employment stayed roughly the same since August. In both months, roughly 5.9 million people took new jobs, while 5.8 million left their current jobs.

Net employment — or the difference between hires and separations — has increased by 2.5 million people in 2019. Economists estimate that the U.S. must add roughly 100,000 jobs each month to maintain the unemployment rate close to its current level of 3.6 percent.

Groups pressure Senate on retirement bill: Dozens of insurance companies and trade associations are urging Senate leaders to take “quick action” to pass a bipartisan retirement savings bill that the House passed earlier this year.

“This important piece of legislation helps to ensure millions of Americans’ financial security,” the groups wrote in a letter to Senate Majority Leader Mitch McConnell (R-Ky.) and Senate Minority Leader Charles Schumer (D-N.Y.).

Groups that signed the letter include the American Council of Life Insurers, the U.S. Chamber of Commerce, Prudential Financial, and the National Volunteer Fire Council.

The House in May passed by a vote of 417-3 a bipartisan bill, known as the SECURE Act, that includes a host of provisions aimed at making it easier for people to save for retirement.

The legislation would make it easier for small businesses to join together to offer retirement plans and require employers that offer 401(k) plans to make certain part-time workers eligible for them. It also would undo a provision in Republicans’ 2017 tax-cut law that had the unintended consequence of increasing taxes on the survivor benefits received by the children of deceased military members.

While the SECURE Act passed with overwhelming support in the House and similar bipartisan legislation has been offered in the Senate, the measure has yet to receive a vote in the upper chamber. The Senate has, however, passed stand-alone legislation to undo the tax increases on military survivor benefits received by children.