sponsored by
10/04/2009
enlarge
Staff photo by Andy Molloyfrom the Kennebec Journal
BUDGET CUTS ORDERED
Many happy returns in Richmond
Tax woes land on Whitefield
Rapist denied new trial
AUGUSTA MINDING A MINE
SPORT OF KINGS Falconry a blend of dedication and commitment
COLLEGE HOCKEY: Maine rallies but falls short against Boston College
COLLEGE ROUNDUP: Colby women win season opener at home tournament
All of today's:
News | Sports
from the Kennebec Journal
from the Morning Sentinel
WEDDING BURGLAR JAILED
Youths talk Turkey Day
Plenty of free Thanksgiving meals available
Turkey prices make for happier holiday
Kennebec County Superior Court
POLICE
COLLEGE HOCKEY: Maine rallies but falls short against Boston College
COLLEGE ROUNDUP: Colby women win season opener at home tournament
All of today's:
News | Sports
from the Morning Sentinel
BY MECHELE COOPER
Staff Writer
Peggy Lane is just hanging on.
The 56-year-old West Gardiner woman said she is one month behind on her mortgage, can't pay her taxes or her electricity bill and just opened her home to a daughter struggling to make ends meet with a six-month-old baby.
Nationally, people are feeling increased economic hardships -- the highest level in the past seven months, according to the Consumer Reports Sentiment Index.
"Consumer confidence has been plummeting," Laurie Lachance, president and CEO of the Maine Development Foundation and former state economist said. "The consumer in Maine is under tremendous pressure. While we're just starting to get some indication that maybe the economy is starting to turn around, it's going to take some time before the consumer comes out of hiding. This is a very real thing touching this state."
People are making fewer trips to the grocery store, eating out less, shopping during sales and dropping nonessential services like cable television, she said.
They're also feeling extreme pressure in the form of bankruptcy filings, delinquency rates on personal loans, credit cards and mortgages, and purchasing big ticket items like cars and building supplies, she said.
The Consumer Reports Sentiment Index, which tells how people feel about their financial situation, shows that almost 38 percent of Americans have had at least one major negative personal finance event in the past 30 days. Credit card, health-care and personal loan issues have contributed to stress levels with 15.6 percent of Americans experiencing higher credit card interest rates and fees, and 8.5 percent losing health insurance or having their coverage reduced in August, according to the index.
The Consumer Reports introduced a new monthly economic survey in August that tracks U.S. consumers' personal financial experiences, attitudes and activities.
The Consumer Reports Index, conducted by the Consumer Reports National Research Center, is a national monthly telephone poll of households. According to the research center, 1,009 interviews were completed among adults 18 and older. Interviewing took place between July 30 and August 2. The margin of error is plus or minus 3.2 percent points at a 95 percent confidence level.
The index reported that increased credit card payments, personal loan problems and healthcare worries have helped drive consumer sentiment to the lowest level in the past seven months, (38.1) since Oct. 2008. When that index is greater than 50, more consumers are feeling positive about their situation.
Lane was a certified medical assistant when she was diagnosed last year with breast cancer. She had a radical mastectomy in October 2008. When she lost her job in June, she was working 30-hours a week.
She said she's tried to explain to the electric company that she's out of work and hasn't been able to find another job.
"We're living together and helping each other pay bills," Lane said of her and her daughter. "I sit here behind on my taxes, behind on my mortgage, and I'm going to get a foreclosure notice in the mail from my bank. So what do I do?"
"You do all the things you're supposed to do," she said. "You pay your taxes, you pay your mortgage, and you don't go to the food bank. I don't want to be rich, I just want to get by. And in this economy, you go into the grocery store to pick up a few things and you pay $50. We're both trying so hard. It's just impossible."
Lachance, of the Maine Development Foundation, said the foundation has just prepared a major analysis for Central Maine Power Company, "The Maine Consumer: Under Pressure." She said the analysis details in "excruciating detail" how Maine families are coping under "extreme pressure."
The report says "Maine is currently in one of the deepest economic downturns it has ever experienced, and, as a result, Maine consumers are under considerable pressure to make ends meet."
The analysis is available on the foundation's web site at http://tinyurl.com/yaqqjrj.
Michael LeVert, state economist with the State Planning Office in Augusta, said retail sales are declining in Maine.
"Retail sales are showing a decline and that would indicate that Maine consumers are still somewhat hesitant to spend at the level they had in pre recession," LeVert said. "For July, the total taxable retail sales were down 8.7 percent from the month before, and year-to-date, 9.3 percent. Consumers are still anxious about the economy and their jobs, so spending is at a level that has not rebounded."
Maine is one of the states eligible for a 13-week extension in unemployment benefits. Eligible states must have an average unemployment rate of 8.5 percent or higher over the last three months. Maine's rate for June, July and August was 8.6 percent, 8.5 percent and 8.6 percent respectively.
Congressman Michael Michaud, said the extension will ensure that those who lost their job will be able to continue providing for their families.
Katrina Roy, of Livermore Falls, said her husband, Dean, has been unemployed since March. She said he was a service manager who supervised new store openings in and out of state. But since the downturn of the economy no one is opening new stores, she said.
"I hear things are getting better, but we don't see it," Roy said. "During the last month he has had three different job interviews, but no one calls him back. When he calls them they say we haven't made a decision yet. There's so many people unemployed out there everyone is going after the same job. There's only one position for 600 people. That's where the frustration lies."
Katrina Roy, a construction clerk for Time Warner Cable, said the bank has already foreclosed on their home and that the family is living in an apartment.
She said they have had difficulty keeping up on car repairs.
"The two cars had to be inspected in September and October and one needed $700 worth of work done," she said. "My mom let me use one of her credit cards, but I have to pay it in 30 days. We weren't sure we'd be able to do that because we didn't know if he would get additional unemployment. Thank God he'll get that and we'll be able to pay it back."
John Barr, deputy superintendent Bureau of Financial Institutions Department of Professional and Financial Regulation, said there is some signs of life in Maine's economy.
He said the bureau on Sept. 21 released results of a quarterly survey of 32 Maine state-chartered banks and credit unions that indicated a substantial increase in new loans for homes.
There were more than 5,300 new loans made in the second quarter of 2009 and 3,650 made in the fourth quarter of 2008, Barr said.
"Whether these loans are to refinance existing debt or to purchase a new home, the increasing number of new loans is a positive economic sign," he said.
Lachance said it is critical that Mainers take time to pay attention to the basics, such as upping the efficiency of schools and the delivery of government services. That way, the state will be in a position to take advantage of opportunities when the economy recovers.
But Marie White, 69, of Randolph, said paying attention to the basics is difficult.
White is a real estate agent for Century 21 Alliance and also cleans the company's office in Hallowell for extra money.
"Real estate is in a slump so you work really hard to make half as much money but the bills keep going up," White said. "I do get Social Security, but that's a pittance. My daughter moved in with me and her three children when she became a widow. When her husband died he left no money, no Social Security, no life insurance, no nothing. This whole thing with the economy hit right afterwards. I have to keep a house to help the family, they're wonderful children, and she's a wonderful daughter. There's no way I could stop working even though I'm pushing 70. It's tough. It's very tough."
Mechele Cooper -- 623-3811, ext. 408
mcooper@centralmaine.com
Reader comments
Click here to view or add reader comments