According to a new Salary Finance research, two-thirds of working Americans believe that their financial situation has worsened since last year despite ongoing inflationary pressures in the U.S. economy. The level of living for the majority of Americans has declined due to rising expenses.
And a lot of people are using their savings accounts or taking on more debt in order to make ends meet. A significant increase of seventeen percentage points from February was observed in the research, showing that 72% of consumers have fewer savings than they did a year ago. The majority of respondents-nearly 30%-also claim to have completely spent down their funds.
Additionally, it would seem that high-income workers are not exempt from the financial strains of the current financial situation. Of those making over $100,000 yearly, half report worsening financial struggles and decreased savings over the previous year. Additionally, more than half of respondents worry about their present financial status at least once each day, and 40% of respondents claim to frequently run out of money.
The consumer price index, which tracks the average change in prices for goods and services purchased by consumers, increased more than anticipated in September and is currently close to its highest levels since the early 1980s. More Americans are living paycheck to paycheck as a result of the growing cost of living; their average hourly earnings, when adjusted for inflation, fell by 0.1% for the month and by 3% from a year earlier.
"Across the board, American workers are struggling financially, regardless of gender, race, ethnicity, sexual orientation, or earnings; in fact, half of American workers making over $100,000 are worse off this year," Asesh Sarkar, CEO of Salary Finance said. "It is incumbent on companies to not only support their employees with financial wellness offerings but truly understand who in their workforces are struggling financially," he added.
"In doing so, they can better provide services for vulnerable work populations who need it the most by implementing benefits that solve their short-term problems while setting them up for longer-term financial stability. With most Americans feeling the financial pinch, now is the time to educate and provide the resources for managers and employees."
The Federal Reserve, for its part, has stated that additional interest rate rises will occur until inflation manifests undeniable evidence of a slowdown. According to Mark Hamrick, senior economist at Bankrate.com, the central bank "continues to see a bright green light with respect to future interest rate increases." "Based on the latest snapshots of inflation, they believe the target range for the federal funds rate must go higher from here," he said. "There's no pivot yet in sight, only a push to higher ground."
