CUs will feel the decline of the middle class

You’ll need a two-pronged response.

Earlier this year, I read some commentary about President Trump’s promise to bring back manufacturing jobs to the U.S. The analyst’s comments were something like, “Well, that’s all fine and dandy for the next few years, but in the long term, the bots are coming.” More recently, an analyst contemplating the impact of a self-driving semi-trucks speculated that 800,000 jobs in trucking could eventually disappear as well. It’s inevitable that advances in technology will displace a tremendous number of workers and replace their jobs with a smaller number of potentially higher-paying, high-tech jobs. While there have been thousands of articles written on the subject, this is one of my favorites, even though it’s now four years old.

The problem for credit unions is that our “sweet spot” in terms of membership is decidedly middle-class consumers. Does a shrinking middle class mean our future business will shrink too? Future strategies have to include a dual approach to this changing economic landscape, or we’ll be left in the dust. First, credit unions need to address the following issues, so they can best serve the displaced middle class:

  1. How can we improve the reach of our financial education initiatives? The middle class is going to need to save more money than ever: a) to be able to eventually retire and pay for future health care needs, and b) to be able to survive a prolonged period of unemployment. My dad was a welder, and when he was working, he made a great income. The problem is that he typically spent every dime of it, so his periods of unemployment, especially during a recession, were painful for the family.


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