Almost two thirds of Americans now say they are living paycheck-to-paycheck, a new survey has found – with nearly five percent of those struggling earning more than $100,000 a year.
As inflation continues to bite – the Consumer Price Index for December showed that, over the last 12 months, the all-items index increased 6.5 percent, before seasonal adjustment – the numbers of those feeling the pinch is still rising.
Of 4,000 people surveyed by industry publication Pymnts.com and LendingClub, between December 8 and 23, a total of 64 percent said they were living paycheck-to-paycheck.
That means 166 million Americans are unable to save any money at all at the end of the month.
And of those 166 million, 8 million – almost 5 percent – were earning more than $100,000 a year. The total figure represents a 9 percent increase from last year.
The average American earns $58,260 a year, according to the Bureau of Labor statistics.
Soaring energy prices have fit into family budgets. A gas station in Los Angeles is seen in September
‘Prospects for consumer spending are cloudy,’ said Lydia Boussour, senior economist at EY Parthenon.
‘Elevated prices, eroded personal savings and increased reliance on credit point to weak consumer spending this winter.
‘These dynamics will be exacerbated by negative wealth effects from lower stock prices and declining home values.’
Respondents also reported trouble in paying their bills.
Almost one in four – 24 percent – said they had issues paying their bills in December.
Among those earning more than $100,000 and living paycheck-to-paycheck, the share rose to 16 percent – up from 11 percent a year earlier.
Lydia Boussour, senior economist at EY Parthenon, warned that the situation was unlikely to improve in the near future
The sharpest increase in costs over the past 12 months has been energy: fuel oil is up a whopping 41.5 percent, year on year, according to the Bureau of Labor statistics.
Food price increases have also hit families hard.
They slowed down in December, but still rose uncomfortably quickly at 10.4 percent above a year ago, federal data show.
Dallas, the Twin Cities, and Baltimore are suffering some of the country’s highest rates of inflation for food prices, – with a rise of 14.1 percent, 13.7 percent, and 13.5 percent in those cities respectively, according to an Axios analysis.
By comparison, food prices rose just 7 percent in Washington DC, 7.7 percent in Chicago, and 8.8 percent in Miami, according to the report.
The latest consumer price index report showed that in December, inflation for groceries continued to be higher than for restaurants, with food at home rising 11.8 percent, and food away from home rising 8.3 percent.
Food price increases slowed down in December, but still rose uncomfortably quickly at 10.4% above a year ago, federal data show
Inflation for groceries continued to be higher than for restaurants, with food at home rising 11.8%, and food away from home rising 8.3%
Inflation rates for groceries hit a 40-year high of 13.5% in August, and have since moderated somewhat.
Driving the steep increases are rising energy and commodity prices, due to lingering effects from pandemic supply chain disruptions, and Russia’s invasion of Ukraine, which sent world wheat prices soaring.
On top of that, an avian flu outbreak has sharply curtailed the national supply of eggs, sending prices soaring in 2022.
The national average price for a dozen grade A, large eggs soared to $4.25 in December – up nearly 140% from $1.79 a year ago, according to the Bureau of Labor Statistics.
More than 43 million of the 58 million birds slaughtered over the past year to control the virus outbreak have been egg-laying chickens, including some farms with more than a million birds apiece in major egg-producing states like Iowa.
Wholesale egg prices have fallen somewhat in recent weeks, following the holiday baking surge, though it remains to be seen how much of that relief will translate to lower consumer prices.
December’s overall annual inflation rate of 6.5 percent marked the slowest annual pace for price increases since October 2021, and the sixth straight month of declining overall annual inflation rates from June’s peak of 9.1 percent.
The national average price for a dozen grade A, large eggs soared to $4.25 in December – spiking by almost 140% from $1.79 in the same month a year earlier
Restaurant prices also rose, though not as quickly as grocery prices
Inflation in the US slowed down once again last month, rising at an annual rate of 6.5%. It marked the sixth straight month that the annual inflation rate has decreased
Prices for energy and many goods moderated or even declined in December, while prices for food, services and housing continued to rise at an uncomfortable pace