The June jobs report marked a turnaround with 224,000 jobs added last month. But even as the numbers point to strength in the labor market, millions of Americans are teetering on the edge of financial ruin.
“There is a core 40% (of Americans) that seem to be suffering,” Robert Sinclair of AAA told Yahoo Finance’s The First Trade.
“We’ve done surveys that say 40% of the driving population can’t afford an emergency repair of their vehicle of $400-$700,” he told Yahoo Finance’s Seana Smith and Brian Sozzi. “We also found that 40% said that $3.00 a gallon would be a pain point for them, that they’d have to make some changes in their lifestyle.”
That means everything from combining errands to save gas to putting off big purchases like new home appliances.
Sinclair says gas prices could spike higher this summer based in part on growing demand and tensions in the Middle East. National self-serve regular gas averages $2.75/gallon, according to AAA. That’s up 5 cents from a week ago but down 11 cents from last year.
Still, gasoline is a major expense, especially as commutes get longer. The average American spends about 26 minutes commuting each way to work every day, nearly 20% longer than it was three decades ago, according to the Census bureau. That leads to wear and tear on cars and increases the price of maintenance, which AAA prices out to about $8,500 a year.
AAA recommends setting aside $50 a month to pay for any unexpected repairs, but that’s tough to do for those struggling to pay everyday expenses.
“Employment is so strong and people are working,” Sinclair says. “For 60% of us, things are great. But there’s 40% out there that are really on the edge.”