The recession has directly hit more than half of the nation's working adults, pushing them into unemployment, pay cuts, reduced hours at work or part-time jobs, according to a new Pew Research Center survey.
The economic shock has jolted many Americans into a new, more austere reality, which is likely to have lasting consequences for an economy fueled mostly by consumer spending. More than six in 10 Americans say they have cut down on borrowing and spending, the survey found.
The reason: Nearly half of the survey's respondents say they are in worse financial shape as a result of the downturn, which destroyed 20 percent of Americans' wealth.
"We're going to see much lower consumption going forward," said Dean Baker, co-director of the Center for Economic and Policy Research. He blames diminished spending on the drop in housing prices. "People who thought they had equity in their homes have seen it disappear," he said.
The longest and deepest recession since the Great Depression has exacted a punishing toll that continues nearly a year after the economy started growing again. Hardest hit are the 9.7 percent of workers who have been out of a job for an average of nearly six months. Many Americans are delaying retirement and others have lower expectations for their children's futures, the Pew poll found.