The United States has been the world’s largest economy for many decades, but wealth is unevenly distributed. Poverty is defined in relation to a yearly fixed income threshold. In 2012, this income threshold was US $ 23,050 for a family of four. The proportion of poor people fell sharply in the 1960s, remained unchanged in the 1970s, but increased significantly during the first half of the 1980s. Thereafter, it fluctuated, but in 2007-10, poverty increased significantly, reaching just over 15%. At that time, 46 million Americans lived below the poverty line, the largest number since 1959. Of children under 18, 22% were poor, and just over 25% of all Latinos (residents of Central and South American descent) and African Americans were poor in 2010. Nearly 32% of all families with single mothers were poor but only 9% of pensioners. The proportion of poor people in 2010 was lowest in the Northeast (12.8%) and highest in the South (16.9%). Poverty was most common in the central parts of the big cities. In 2011-12, poverty continued to increase.
The median income in the United States was at its peak in 1999 and since then it has steadily shrunk, in 2010 to reach US $ 49,445. For many years, income for the richest tenth of households has continued to increase, while the income of the poorest has remained unchanged. The income gap has thus increased. Median income is highest among residents of Asian and European descent. Visit AbbreviationFinder to see the definitions of USA and acronym for United States.
The basic principle is that the individual should be free to decide for themselves about their insurance policies, their form and scope. General insurance is not as common as most other countries, and social benefits and their terms are regulated in workplace contracts. The conditions vary widely between different types of work and different companies. Anyone who does not have a job, has short-term employment or works part-time is affected by this. Increased flexibility in the labor market and increased unemployment have therefore, for more and more families, meant growing insecurity in sickness and pre-retirement age. This has long been an important domestic policy issue. Charity plays a greater role in the United States than in other comparable countries.
The federal state’s structure means that basic rules for public insurance systems are decided by Congress, while the design and sometimes the extent of benefits in these systems are determined at the state level. This leads to clear differences between the states.
The general social insurance is called Social Security and mainly covers pension, survivor, disability and unemployment insurance, as well as Medicare (health insurance for the old, see below) and the supplementary health insurance PPACA (“Obamacare” from 2010). Payments to these insurance policies are linked to wages and taxes and require an individual Social Security Number. Unlike the Swedish national registration number, not all citizens are assigned at birth, but it is required to obtain a permit to work.
Child allowance and childcare
There is no general child allowance in the US, which is very uncommon in rich countries. However, a parent can apply for a tax reduction in his declaration. Needy families can apply for need-tested forms of financial support. Statutory parental leave does not exist generally, but companies with more than 50 employees must provide up to twelve weeks of unpaid leave at childbirth or for the care of sick child or other family member. Paid leave, mainly for the mother, occurs for some employees in some states, eg. California and New Jersey. Childcare is a market where there are various forms of private solutions, mainly day care, family day care and care of “nannies” in the child’s home. Many day care centers are run by religious communities, and there are also workplace-affiliated and company-sponsored day care centers.
The US spends significantly more money on health care than other countries. In 2010, it accounted for 17.9% of US GDP (Sweden 9.6%). However, the costs of health care are paid to less than half of public funds and to just over half of private funds (in Sweden to 4/5 of public funds). In 2007, the United States had 24 physicians per 10,000 residents (Sweden 36), 106 nurses (Sweden 108) and 30 nurses (Sweden 28).
There are many reasons for the high expenditure, mainly more advanced technology, higher treatment costs and a larger proportion of overweight residents with related health problems. 3/4 of all healthcare costs go to the treatment of chronically ill patients with mainly diabetes, obesity, cardiovascular disease, high blood pressure and cancer, ie. lifestyle diseases that in many cases could be prevented. AIDS has also been a major burden on health care. The proportion of HIV-infected persons in 2007-11 was stable at 0.6% among residents aged 15-49. Since the 1980s, obesity has become an increasingly serious problem. In twelve states, most in the South, more than 30% of adults were overweight in 2010. Child obesity and diabetes have a similar prevalence. Abortion is a legal right in the United States, but it is highly contentious.
Despite the costly healthcare and the huge investments in medical technology and despite world-leading medical research and drug production, the results of health care are not as prominent. In terms of average life expectancy, the US was ranked 24th among the 40 OECD countries at the end of the 1990s. The infant mortality rate in 2015 was 6 ‰, which meant that the United States was in that regard at about 45 in the world. Maternal mortality in connection with childbirth was three times more common than in Sweden. This is particularly reflected in socio-economic ill-treatment and shortages of healthcare in poor areas in the United States.
The fact that the US public social insurance system is less extensive than in most other industrial states is most evident in terms of protection against illness. Those who do not have a permanent connection to the labor market must find their own solution to the need for insurance. For a long time, most people who have had the opportunity have taken out extra insurance. However, it was not uncommon in the past for insurance companies to be reluctant to insure individuals because of their gender, health status or professional background. For those who did not have insurance, the costs of health care could be sky high, perhaps prohibitive. Estimates in 2010 showed that approximately 50 million residents in the United States lacked insurance cover for illness.
More than 150 million Americans had health insurance through their own or spouse’s work in 2009, while nearly 100 million had full or partial insurance through Medicare or Medicaid, two public insurance systems. Medicare is a federal system, which provides health insurance for everyone who is 65 years and older, as well as for younger people with certain disabilities and also for anyone who needs dialysis. For such elderly support, a long-term employment with an employer connected to the system was required. Medicare covers hospital, treatment, medical and medical expenses. Medicaid is a supplemental system that is jointly funded by the federal government and the states and therefore has different names in different states. It pays medical care for those who are not covered by Medicare, mainly low-income families and the elderly with greater care needs.
After many years of preparation, negotiation and barriers under several presidential regimes, President Barack Obama in March 2010 got through a Congressional resolution on a healthcare reform, the Patient Protection and Affordable Care Act (PPACA), popularly called Obamacare. At the heart of the reform is the individual’s own responsibility for having health insurance. Low-income recipients must receive tax deductions to be able to buy insurance, and those who do not have insurance may be fined. Young adults up to the age of 26 can be covered by their parents’ insurance. Insurance companies are now obliged to receive everyone who wants to buy insurance and give the same benefits to everyone, regardless of gender and health status. In connection with PPACA, Medicare has been expanded.
The reform sparked extensive debate in the United States. A majority of the states required the Supreme Court to consider whether the new law was consistent with the Constitution. The main argument was that the state must not require anyone to buy something (and punish the one who does not buy) and that the state must not determine rules for the actions of the insurance companies. In June 2012, the Supreme Court found that the reform did not violate the Constitution; compulsory insurance is considered a tax and anyone who does not fulfill the requirement can therefore be penalized. However, several million residents in the United States will still lack insurance cover for illness, especially many unrelated to the labor market.
Labor market and trade unions
In the spring of 2012, the workforce in the United States comprised 53% of men and 47% of women. Unemployment almost doubled in the years 2005–10, after which it fell slightly; in July 2012 it was 8.3% (approximately 12.8 million people). Unemployment is highest among African Americans and lowest among Asians, and it is three times higher among low-skilled than among highly educated. The proportion of long-term unemployed has increased and they accounted for just over 40% of all unemployed in the summer of 2012. According to the Social Security Act of 1935, in each state there is a system for compulsory unemployment insurance, funded with employer contributions. The time an unemployed person can obtain unemployment insurance varies from six months to about 1.5 years.
Trade union membership increased sharply during World War II. It was most extensive in the mid-1950s, when just over a third of all employees were members of any trade union. In 1955 the umbrella organization was formed AFL-CIO (American Federation of Labor and Congress of Industrial Organizations) and most unions are part of it. A smaller part can be found within CtW (Change to Win)), which was formed in 2005 as an offshoot of the AFL-CIO. Since the mid-1950s, trade union membership has been steadily declining and is now lower in the United States than in other highly developed industrial countries. In 2011, only 11.8% of all employees were members of a trade union. Among public employees, the share was 37%, among private employees just under 7%. The highest was in the education and protection profession (teachers, police, firefighters) as well as among transport workers and construction workers, the lowest in agriculture and the financial sector and among commercial employees. The proportion of connected persons was highest among the oldest in the labor market and lowest among the youngest, and it was higher among African Americans than among others. The proportion of union members is considerably lower in the South than in the rest of the country. At most, it is in the state of New York and the peripheral states of Alaska and Hawaii.
By 2012, the United States had ratified only 16 of the ILO’s nearly 190 conventions. Conditions on the US labor market are regulated within the individual states and general laws for the entire nation are usually missing. The regulations vary widely between different states and often there are no rules. Generally speaking, the US labor market is not family and women friendly but entrepreneurial in the traditional sense. Normal working hours are 40 hours a week, and usually ten paid vacation days per year are given. The benefits in these respects are determined in agreements between employers and employees. Compulsory work injury compensation is included in the social security systems.
The normal retirement age is 65, but it is now being gradually increased and is planned to be at 67 in 2027. Since 2008, when unemployment rose sharply, it has become more common to take out pension as early as possible, ie. at age 62.
Calculations of the Human Development Index (HDI) for 2011 showed that the United States was then in fourth place among 187 countries. However, similar comparisons of gender equality, measured in various respects, place the United States as low as in place 47. An important reason for that is that only 17% of congress members are women. On average, women have just over 77% of the salaries that men have in similar positions, and only 3% of managers in the 500 largest companies are women. But women are considering higher education. Of all those who take the master’s degree at the university, 60% are women, as well as half of all who take the law and medical degree. 75% of all employed women work full time and in recent years unemployment has affected men to a greater extent than women. But among the most vulnerable families, single mothers are over-represented.