American Consumers Newsletter

by Cheryl Russell, Editorial Director, New Strategist Press
October 2008

Don’t Blame Main Street

3. Cool Research Links:  KAISER STUDY, 2007 DEMOGRAPHICS
4. New book by Cheryl Russell:  BET YOU DIDN’T KNOW
5. New series from New Strategist:  TEN THINGS YOU NEED TO KNOW

1. Hot Trends

Don’t Blame Main Street

Americans are standing with their mouths agape as the stock market lurches. They lie awake at night worrying about what the future holds for their jobs, their families, and their communities. Who is to blame for this unfolding financial crisis? The finger of blame is pointing in many directions, but one place that does not deserve the blame is Main Street.

Just in time to provide some perspective, the Census Bureau has released the latest American Housing Survey, with data collected only a few months ago in 2007. You can’t get much more current than that. And what do the 2007 numbers tell us? They tell us that the average American has been betrayed by financial institutions that should have known better.

No doubt you have heard many a pundit exclaim–in print and on TV–that Americans did this to themselves. We bought houses we could not afford, we used our homes as ATM machines, and we have fallen so deeply in debt that millions of us face foreclosure. Our bad behavior has brought the nation’s financial institutions to their knees.

Just because newspapers and television say so does not make it true. In fact, the average American has been careful with his money. But the institutions in which we entrusted our dollars gambled them away.

The 2007 American Housing Survey provides the evidence.

First, let’s take a look at mortgages. In 2007, the 51 million American homeowners with mortgages remained well above water. They owed a modest median of $100,904 on their homes–just 54 percent of their home’s value. This statistic has not changed much in years–it was 55 percent 10 years ago in 1997. Granted, home values have dropped since 2007 and are likely to fall even more. Still, for most homeowners a substantial cushion remains. Only 3 percent of homeowners owe more than their house is worth. The great majority of homeowners with mortgages have 30-year fixed-rate loans carrying a median interest rate of 6.4 percent. Things on Main Street appear to be in order.

Second, let’s take a look at home equity loans. The way it is reported, you would think everyone has a home equity loan. But among the nation’s 76 million homeowners, only 14 million had a home equity loan or line of credit in 2007. Do the math, and that translates into just 19 percent of homeowners. Or put it this way: 81 percent of homeowners do not have a home equity loan. Even those who have tapped into their equity have not been using their home as an ATM machine. The median amount owed on home equity loans is a reasonable $25,934. Again, nothing exciting to report on Main Street.

Third, let’s take a look at foreclosures. Most of the foreclosure numbers in the press come from Realtytrac, an online business that sells foreclosed properties–and in the process of doing so, collects foreclosure data. Realtytrac provides foreclosure statistics to much of the media, including the Wall Street Journal. Not surprisingly, its data show a big increase in foreclosures. In 2007, says Realtytrac, “more than 1 percent of all U.S. households were in some stage of foreclosure.” That sounds like trouble on Main Street. But read the fine print in the methodology, and you will discover that the definition of Realtytrac’s “households” is the Census Bureau’s count of “housing units.” There is a big difference between the two concepts. When a household faces foreclosure, a family loses its home. A household is defined as an occupied housing unit–meaning that someone lives there. In contrast, many housing units facing foreclosure are vacant, owned by flippers and developers who gambled on rising prices and lost.

In 2007, 14 percent of the nation’s housing units were vacant–a record high. Overbuilt, overpriced, and financed by cheap money, these housing units are the crux of the crisis–a crisis caused by lax lending standards. It was not Main Street, but Wall Street that drank the Kool-aid. Main Street, however, is paying the price.

By Cheryl Russell, editorial director, New Strategist Publications
If you have questions or comments about the above editorial, e-mail New Strategist at


Percentage of workers aged 55 or older who expect
to postpone retirement until age 66 or older:

1998:  18
2008:  46


2. Q & A

How Many Have Health Insurance Through Their Own Employer?

Surprisingly few Americans have health insurance through their own employer. In 2007, the figure was just 31 percent, according to the Census Bureau’s Current Population Survey. The percentage covered through the plan of a parent or spouse’s employer is almost as large, at 28 percent. Another 28 percent of Americans are covered by government health insurance–either Medicaid, Medicare, or military. Just 9 percent buy their own private plan.

By age, only 45-to-54-year-olds are likely to be covered by their own employer’s health insurance plan. Fifty-one percent of people aged 45 to 54 have their own employment-based health insurance. In every other age group, less than half have insurance in their own name.

Males are more likely than females to have their own insurance–35 versus 27 percent. Among non-Hispanic whites, 35 percent have health insurance through their own employer. The figure is 31 percent among Asians and 27 percent among blacks. Hispanics are least likely to have health insurance through their own employer, at 20 percent. A larger 32 percent of Hispanics have no health insurance.

Since 2000, the percentage of Americans covered by their own employer’s health insurance plan has fallen by 2 percentage points.

Percentage of people covered by their own employer’s health insurance plan by age, 2007:

under age 18       0.3%
aged 18 to 24     19.0
aged 25 to 34     47.3
aged 35 to 44     48.9
aged 45 to 54     51.2
aged 55 to 64     49.9
aged 65 or older  25.7

By Cheryl Russell, editorial director, New Strategist Publications. If you have any questions or comments about the above Q & A, e-mail New Strategist at


Percent change in the number of full-time students
enrolled in four-year colleges, 2005 to 2006: -4.2.


3. Cool Research Links

To keep up-to-date on ever-changing demographics and lifestyles, check out these useful links.

Employer Health Benefits
If you want a good scare as Halloween approaches, take a look at this report, Employer Health Benefits: 2008 Annual Survey. Produced by the Kaiser Family Foundation and the Health Research & Educational Trust, everything you do–and do not–want to know about employment-based health insurance is here. This is where the numbers you are reading in the media–and hearing in the presidential debates–come from.

The average annual premium for a family with employment-based health insurance: $12,680, up 5 percent in the past year. The average monthly premium paid by employees for family coverage: $280, a figure that has doubled since 1999. Percentage of workers at small firms whose annual deductible for single coverage exceeds $1,000 per year: 35 percent, up from 16 percent just two years ago. Very scary statistics.

2007 American Community Survey
They are here–the latest statistics on Americans and their communities. At this portal to the numbers, you can mix and match to discover the answer to just about any demographic question for the nation as a whole, states, metropolitan areas, counties, and communities with populations as small as 65,000.

Want to know which state has the largest percentage of households that receive retirement income? Find out in the Ranking Tables. By the way, it’s not Florida–which ranks 12th. Or if you are curious about housing values in your area, or the percentage of households with mortgages, you can find those facts and many more here as well.


Percentage of children who live in families with incomes below $36,000: 34.


4. New Book: Bet You Didn’t Know

You need this book if you wonder what is happening to our country–and to your 401(k). You need this book if you are thinking about repositioning your business in the changed economic landscape.

The “goddess of demography,” Cheryl Russell, the editorial director of New Strategist Publications and former editor-in-chief of American Demographics magazine, has spent a career connecting the dots. Now you can benefit from her insights on 201 different topics ranging from homeownership to retirement savings, men’s earnings, college costs, pet ownership, sexual orientation, voting rates, and even happiness itself.

According to the Sacramento Book Review, Russell’s insight “really makes this book shine.”

Order your copy of Bet You Didn’t Know for just $18.95 from New Strategist Publications (ISBN 978-1-59102-635-8).


5. The Opportunity Series: Ten Things You Need to Know

The New Strategist demographers, who have been tracking trends for more than two decades, will show you what you need to know in the new Opportunity Series, which kicks off with three comprehensive titles. More than just pages of statistics, each title provides innovative ideas and analysis to help you find that Big Idea.

Ten Things You Need to Know about the Children’s Market
Marketing to children today is a challenge. Not only are children harder to find in our aging nation, but children themselves are becoming more diverse in every way. $89.95 (ISBN 978-1-933588-96-4)
Ten Things You Need to Know about the College Market
The college market is large and, until recently, has been growing rapidly. But with college costs rising beyond affordability for most families, the size of the market may have peaked. $89.95 (ISBN 978-1-935114-00-0)

Ten Things You Need to Know about the Retirement Market
The oldest baby boomers are now entering their sixties, and businesses that have long served retirees are anticipating an enormous expansion in the market over the next few years. $89.95 (ISBN 978-1-935114-01-7)
Buy all three titles and save
Buy all three titles in The Opportunity Series–focusing on the Children’s, College, and Retirement Markets–and save.
$245.00 (ISBN 978-1-935114-08-6)



6. Books from New Strategist

A to Z Guide to American Consumers
Need a research assistant? Here is one that is reliable and does not have to be added to the payroll: The A to Z Guide to American Consumers: Quick Links to Free Demographics. For only $59.95–or an even better $49.95 if you opt for the handy electronic version–you can get the demographic information you need in just a few keystrokes. The A to Z Guide is your quick link to free information about topics ranging from Adoption to Zip Code Demographics. Plus, there is a contact list of 54 major surveys or data collection efforts ranging from the American Community Survey to the Youth Risk Behavior Surveillance System that provide demographic information about the U.S. population, all available for free or a nominal charge.

(ISBN 978-1-933588-97-1) Just $49.95 for the electronic version, which can be downloaded today, or order the hard copy for $59.95. To see the table of contents, sample pages, and more, click here.

American Attitudes
Researchers who want to explore Americans’ changing attitudes can rejoice: the new fifth edition of American Attitudes is finally here. American Attitudes: What We Think about the Issues That Shape Our Lives reveals what the public thinks about topics ranging from premarital sex to global warming, how Americans feel about their money and their marriages, what our hopes for our children are, how often we socialize and with whom, our religious beliefs, political leanings, and working conditions. It shows those answers by the demographics that shape perspective–sex, age, race, and education. American Attitudes also compares attitudes in 2006 with 1996, examining how opinions have–and have not–changed during those 10 years. Please note that the electronic version of this title includes links to spreadsheets of the book’s 321 tables.

(ISBN 978-1-933588-93-3) Just $79.95 for the electronic version, which can be downloaded today, or order the hard copy for $89.95. To see the table of contents, sample pages, and more, click here.
American Generations
Joining the lineup of updated titles is the long-awaited sixth edition of American Generations: Who They Are and How They Live, a superior resource for researchers who want to quickly and easily compare and contrast the five living generations–Millennial, Generation X, Baby Boom, Swing, and World War II. Opening with an in-depth overview of the demographics of the generations, American Generations’ 12 chapters examine attitudes (a newly added chapter), education, health, housing, incomes, labor force, living arrangements, population, spending, time use (a newly added chapter), and wealth. Please note that the electronic version of this title includes links to spreadsheets of the book’s 273 tables.

(ISBN 978-1-933588-95-7) Just $79.95 for the electronic version, which can be downloaded today, or order the hard copy for $89.95. To see the table of contents, sample pages, and more, click here.