Inflation is hitting just about everyone, but a new survey shows that it’s hitting America’s working men and women – those who work for hourly wages instead of salaries – the hardest.
A Harris Poll of hourly workers, commissioned by DailyPay and Funding Our Future, reveals how quickly rising prices have resulted in a reversal of fortunes in many households. Thirty-nine percent of women in the survey said they are saving less money than they did last year. Another 40% of hourly workers with a household income of less than $100,000 said they are saving less than last year or not at all.
The prices of some products are causing more distress than others. Eighty-one percent of hourly workers in the poll reported that higher gas prices have made it difficult to pay other expenses.
When asked to list the expenses that are causing financial hardships, 49% of respondents mentioned groceries, 48% listed gasoline, 40% said utility bills are causing economic distress, and 34% said it is harder to pay their rent or mortgage.
While these expenses are going up, many hourly workers said their incomes are not. Thirty-five percent said they haven’t received a raise in over a year. The less money these workers earn, the more likely they are to say their pay has remained flat.
The importance of emergency savings
All of these financial worries are taking a toll on personal well-being, with 77% of hourly workers saying their health has suffered because of financial worries.
"First the pandemic's immediate economic fallout, now record inflation and high gas prices have reminded us how important financial security and flexibility are for American families," said Shai Akabas, director of economic policy at the Bipartisan Policy Center. "It's crucial that we increase access to tools like emergency savings accounts and on-demand pay that help workers save for and weather turbulent times."
Previous research has made it abundantly clear that millions of people don’t have nest eggs available to cushion inflation’s blow. Last month, LendingClub Corporation published research showing that nearly two-thirds of the U.S. population lives paycheck to paycheck.
By its very definition, living paycheck to paycheck means you aren’t putting any money in savings or building an investment portfolio. As long as they pay their bills on time, these consumers remain creditworthy. However, it could take just one unexpected car or home repair bill -- or an increase of $5 a gallon for gasoline -- to change that.