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Yahoo Finance Plus 81% of Hourly Workers Say Record Gas Prices Have Negative Effect on Ability to Pay Other Expenses, New Survey Says
The 41-year high inflation and the soaring gas prices are taking a toll across the nation. Now, a new survey shows that American hourly workers are bearing the brunt of these challenges, with a staggering 81% of them reporting that record prices at the gas pump have had a negative effect on their ability to pay other expenses.
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The new Harris Poll survey, commissioned by DailyPay and Funding Our Future, found that these financial difficulties are hitting certain communities more than others.
“Unfortunately, it’s not surprising at all. Recent data show that 49% of Americans don’t have enough money on hand to cover a $400 emergency,” Jeanniey Walden, Chief Innovation Officer at DailyPay, told GOBankingRates. “With so many people living paycheck-to-paycheck, any dramatic cost increase of everyday expenses will be damaging. With the recent surge of gas prices and inflation, hourly workers either have to scale back their spending or resort to potentially financially crippling options such as payday loans or overdrafting a bank account to make ends meet.”
The survey found that 75% of hourly workers have struggled to pay expenses this year. At the top of the list are groceries, gas, utilities and rent/mortgage.
Walden said that it’s surprising that those numbers are not higher.
“Most hourly workers drive to work, and gas prices have seen the largest bump — up by nearly 50% — with other necessities such as groceries up about 12%,” she said. “The average American family is now spending close to $330 more a month than last year, according to Moody’s Analytics. This trend will likely continue based on macroeconomic and geopolitical context, including global supply chain challenges and the war in Ukraine.”
Compounding these challenges, 35% of all hourly workers report receiving no pay increase over the past year, a figure that soars to 49% for hourly workers in households making under $50,000 a year.
There is also a gender gap in how it is affecting women, with 39% of them saying they are saving less than last year, compared to only 28% of men.
“Women face additional financial burdens that may prevent them from saving, compared to men, which were only exaggerated during the pandemic,” Walden said. “The cost and responsibility of childcare disproportionately fell on women during the pandemic, forcing many to leave the workforce entirely.”
In turn, the survey notes that these issues are taking an enormous toll on employees’ well-being, with 77% claiming stress from managing finances is hurting their health.
“With such a tight labor market, employee retention poses a challenge for nearly all businesses. Engaged employees who feel valued are more productive, less stressed, and stay longer on the job,” Walden said.
Asked what employers can do to alleviate this stress, Walden said that “a great way for employers to reinforce their commitment to their employees is with benefits that make a difference in their lives including childcare, commuter stipends, carpool incentives, pet insurance and on-demand pay.”
Finally, the survey found that 40% of hourly workers with a household income of less than $100,000 say they are saving less than last year or not at all, compared to 31% of hourly workers with a household income of $100,000 or more.
Walden said, however, that with the right tools and knowledge, it is possible to still save, despite inflation and higher prices across the board. She offered some tips, including creating a decision matrix.
“Your decision matrix should list out the pros and cons of making your decision in the short term — meaning in the next three months, six months, and one year from now,” she explained. “Budget and stick to it. Be wise about how you spend your money. Hold off on expensive, unnecessary purchases. When buying goods, opt for the affordably priced option.”
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She also recommends signing up for an automated savings program through your bank or on-demand pay provider.
“Set a goal for saving. As you continue to make more money through your career, be sure to increase your contributions to your savings. When you set a goal, it’s easier to remember to save and to stick to it,” she added.
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This article originally appeared on GOBankingRates.com: 81% of Hourly Workers Say Record Gas Prices Have Negative Effect on Ability to Pay Other Expenses, New Survey Says
