The impact of inflation has been particularly challenging for middle-class Americans. As prices surged, their income growth failed to keep pace, resulting in a strain on their ability to maintain their desired lifestyle. In fact, 72% of middle-income families now report that their earnings are falling behind the cost of living, up from 68% a year ago. Additionally, 74% say they are unable to save for the future, compared to 66% previously. The situation is concerning, and many households are dipping into savings or running up credit card balances to bridge the gap. As economists forecast a possible recession, 62% of middle-income households recognize the need to get financially prepared.
Almost two-thirds of Americans considered middle class have said they are facing economic hardship, per Bloomberg.
In the survey, 65% of people who earn at least $60,000 for a family of four said they are struggling financially
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via CNBC:
- Lower-income Americans are already in a recession, according to JPMorgan’s Matthew Boss.
- The analyst said the US was in a “selective” recession as some consumers .
- 67% of middle-class Americans said they believed their income wasn’t keeping up with the cost of living.
The US economy is in a “selective recession,” as lower-income Americans are struggling to get by while upper-income consumers are doing just fine, according to JPMorgan analyst Matthew Boss.
Speaking to CNBC on Tuesday, Boss pointed to the divergence in upper-income and middle-to-lower income Americans, the latter of whom are struggling to keep up with the rising cost of living as prices remain elevated and savings dwindle.
“You have the consumer at the high end who is being more choiceful. The low-end I do think is a melting ice cube … What I’m calling it now is a selective recession,” Boss said. “[B]y our survey, over 70% of low-income consumers right now are saying that they’re struggling to make ends meet.”