And in the United States, over half of households are financially precarious. As new reports confirm that nearly 3 in 10 Americans are now living paycheck to paycheck, we cannot afford not to act. Meet 34-year-old Austin H. He is a master of fine arts and has been on a steadfast journey for employment, applying to almost 1,000 positions over the last year. He works extremely hard, but he’s barely making ends meet. He supports his partner, an aspiring veterinary student, and lives in fear of their increasing student loans.
Austin’s mistakes are symptomatic of a larger pattern hurting America’s lowest-income households. The share of these households that are living paycheck to paycheck rose from 27% to 29% since early 2023. With wage growth stagnating for so many Americans, the economic landscape is still daunting for anyone looking to get on firm footing. Austin, an Express employee, shares his concern over feeling as though he could lose his job at any moment without a safety net. His emotions capture the aspirations and frustrations of all prospective homeowners and families-to-be, who feel trapped in an unending hamster wheel of economic precarity.
The Challenge of Job Seeking
Without added support, Austin H. will have an uphill battle in his job search. Unfortunately, over the past year he has applied to about 1,000 jobs with similar results. He had just completed his master’s degree and was looking forward to getting a job, setting himself up for the long term. This chance would allow him to provide for himself and his partner. Instead, he’s met with a steady wage growth that trails the pace of our quickly increasing cost of living.
“We work full-time and have degrees. And we’re getting nowhere.” – Austin H.
This sentiment rings true for millions of people in our country who are struggling with the same situation. The uncertain economic future has fostered a chasm between what students are educated for and what jobs are available, causing a loss of hope among many. Austin’s frustration is compounded by the fact that he will likely be unemployed in the coming months without any safety net to fall back on.
Unemployment impacts Austin too little to matter As far as a lack of available work goes, new regional and national wage trends paint an ugly picture. Yet by October, real, after-tax wages for the median consumer had risen by just 2% or so compared to a year ago. At the same time, low-income Millennials only experienced a dismal increase of 1%. Conversely, wages for high-income earners increased by an incredible 4%, exacerbating the wage divide between lower and higher income individuals.
The Weight of Student Debt
Austin H. is severely troubled by his student debt. He’s worried that it will threaten his plans to finally be able to settle down life with his long-term partner. Now, through the pandemic, with ever-rising costs and wages flatlined, paying off student loans feels like a dream that’s become terrifying.
“To be 34 and living paycheck to paycheck with no savings, things are pretty crappy right now.” – Austin H.
For too many graduates, it’s an impossible uphill battle. They are trying to meet the daily grind of financial obligation with the aspirational right to have a family that is sustainable and secure. The burden of student debt looms large over Austin’s dreams of homeownership and starting a family—a goal he holds dear.
The financial strain is clearly reflected in national statistics. As of late September, nearly 6.65% of subprime borrowers are more than 60 days past due on their auto loans. This trend further underscores the challenges many Americans face as they attempt to navigate their financial obligations amid rising costs.
Economic Concerns for Households
According to a recent ADP report, a record number of American families are now living paycheck to paycheck. It places the future economic security of average American families in grave doubt. They all fear that this increasing practice may undermine the very bedrock of a consumer-driven economy.
“This could weaken the foundation of a consumer-driven economy.” – Gregory Daco
When families don’t have the money to get by, their purchasing power is lost and so is the potential for economic growth. Voices like Austin H.’s remind us of the demand, and indeed the imperative, for systemic change. We need to close the wage gap and uplift those who are working towards economic mobility.
Vanessa Jones, a fellow survivor of these economic realities, is the one who drives home the point about the gap between policy-makers and real life.
“The people claiming prices are lower are not actually buying their own groceries or trying to find the cheapest place to get their car fixed.” – Vanessa Jones
Jones advocates for greater empathy from decision-makers, urging them to understand the challenges faced by those living paycheck to paycheck.
“They need to walk in our shoes.” – Vanessa Jones
Looking Ahead
As Austin H. thinks about what lies ahead for him, he thinks there is no place but up for his future fortunes. Though he dreams of owning a house and starting a family, he’s realistic about the many barriers that lie ahead of him.
“We want to own a house and start a family, but I don’t know how we will ever get our feet under ourselves.” – Austin H.
His story depicts the harsh reality of an increasingly bitter time for many Americans. Without bold action on wage growth and job creation, millions of people will still be stuck in their own sense of insecurity.