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About 20 percent of U.S. workers—roughly one in five—run out of money between paychecks, up from 15 percent a year ago, a February survey of 3,000 adults by Salary Finance found.
Among respondents, 25 percent said they find it harder to afford necessary expenses and a third are unable to save any money.
Inflation is eating any cushion out of people’s incomes. Prices rose at an annual rate of 7.9 percent in February, while U.S. salaries and wages added only 5.1 percent over the period, according to the Bureau of Labor Statistics.
Despite strong gains in pay, people effectively have less purchasing power now than they did a year ago.
The problems are worst among low-to moderate-income households, the survey reported.
Low-income earners must direct a larger share of their incomes to transportation, food, and housing costs than those earning more.
People with annual incomes below $50,000 have the hardest time making ends meet, economist Kayla Bruun at Morning Consult told CNBC.
Rich Get Richer
And as we note in this Trends Journal, while the middle class shrinks and inflation outpaces wages, CEO’s are making more money and heading for a new record. (See “CORPORATE WELFARE: LUCRATIVE TAX BREAK FOR THE LUXURIOUS” in this issue.)
TRENDPOST: The Salary Finance survey adds evidence to past polls that a $100,000 income often is not enough to afford the conventional “American Dream” of a detached house in the suburbs with two cars and a college fund for the kids (“$100,000 Income, Chump Change? Can’t Afford “American Dream,” 11 Jan 2022) and that Americans need an annual income of $128,000 to feel financially secure (“Middle Class? Forget About It. Americans Need $128,000 a Year to Feel Financially Secure,” 18 Jan 2022).
TREND FORECAST: The descent of the U.S. economy into Dragflation will continue to thin out the American middle class, sparking social turmoil, unrest, and new political movements.
TREND FORECAST: Our “OFF WITH THEIR HEADS 2.0” trend from December 2019, forecasting the global rise in anger directed at the 1 percent, was already spreading globally prior to 2020’s COVID War.
As the gap between the rich and poor widens, so, too, will the animosity between the “haves” and “have nots.” And as the Bigs keep getting bigger, income inequality will be a key platform in the formation of new political parties across the globe.
Gated communities will increase in popularity, and more private security will be hired by the haves who will be gangland targets.