(Reuters) - U.S. consumers are taking out debt at a far faster rate than their incomes or the economy are growing, and just as we may be hitting a peak in employment.

Add in rising interest rates courtesy of the Federal Reserve and you have the consumer sector - 70 percent of the U.S. economy - treading on thin and thinning ice.

U.S. consumers have run up over $1 trillion on credit cards, hitting a level not seen since January 2009 and up 6.2 percent from a year ago. For comparison, wages are up less than 3 percent and the economy is growing just under 2 percent a year.

Borrowers can only take on debt at twice the rate they increase the ability to service it for so long.

Student and auto loans are also at $1-trillion-plus levels and also growing about twice as fast as wages or the economy.

To be sure, the percentage of disposable income the average household needs to service debt is hovering at about 10 percent, near all-time lows. So too are interest rates, and the thing about interest rate changes at very low levels is that small increases in absolute terms imply large increases in proportional ones.

Two important points about the backdrop:

Firstly, the Fed, happy to ‘normalize’ rates while it can, is likely to hike rates by a quarter percentage point twice more this year and, as indicated in the most recent interest-rate-setting meeting minutes, is also planning to begin the long and fraught process of unwinding its $4.5 trillion balance sheet.

Secondly, while labor market conditions are on par with their 2006-2007 peak, according to Barclays Capital, momentum in the labor market is flagging. Friday’s jobs report showed payrolls expanding by just 98,000 in March, far less than expected, even as the jobless rate fell to just 4.5 percent.

Fed tightening, both balance sheet and interest rate variety, will both “only serve to strain liquidity conditions and raise debt service costs,” economist David Rosenberg of Gluskin Sheff wrote in a note to clients.

“Nobody sees a recession coming, but history shows there is a 90 percent chance we see one in the coming year. Household debt loads are at cycle highs. Fed rate hikes mean interest costs will be absorbing funds that would otherwise be diverted to cyclical spending.”

The larger question is why workers in an economy with such low unemployment see the need to borrow aggressively, even if debt service levels indicate they have headroom.

A PROBLEM OF COMPOSITION

That’s because though many jobs have been created, they are not, by and large, jobs which allow for middle-class standards of living without spending above one’s income. The savings rate, at 5.5 percent, is well above the crazy 1.9 percent lows of 2005 but is hugely flattered by savings among the richest. Among the bottom 90 percent of Americans, the savings rate since the financial crisis has bumped along near zero, with the lion’s share made up by a 38 percent savings rate among the top 1 percent. (here)

This paints a picture of an economy badly out of balance. Those consumers taking on credit card debt, and auto debt, and student debt are not, by and large, doing so out of confidence and with prudence, but because of need. Wages simply have not risen enough for the typical household to make its way, and the fact that debt service has been kept artificially low only serves to underscore exactly how aberrant matters are.

This time, of course, won’t be like last time, and financial institutions are far less likely to be caught wrong-footed by a sudden downturn in the economy. That’s positive because we are far less likely, should we slide into recession, to face anything like a banking crisis. Banks are taking on less risk and monitoring the risks of their consumer-facing portfolios more closely.

This, though, means that banks will likely turn off the tap of credit availability more quickly, and with less provocation, then last time. Banks won’t be surprised by a recession, they will help cause it by tightening credit availability.

Data from the Federal Reserve’s survey of senior loan officers already shows a tightening is under way, with banks moving from making consumer debt easier to get to harder in the last six months. The last time we saw this pattern was 2008, and though the banks seem to be out in front of economic developments this time it will be of little comfort.

An economy this reliant on debt finance among a huge mass of households who can barely keep their heads above water is a risky proposition.

(The opinions expressed here are those of the author, a columnist for Reuters.)