Gas Prices Highlight That Cost of Living is Outpacing Wages
With gas prices soaring to an average of $3.69 a gallon in Louisville, people are paying closer attention to the gap between paychecks and rising prices across the board.Since January 2011, retail prices have increased at a rate of more than a 5.6 percent while wages have been going in the opposite direction. According to the Bureau of Labor Statistics, U.S. hourly workers haven't received a pay increase in four of the last five months.From NPR:That lack of wage growth has come at a difficult time for people who drive to work. The typical U.S. driver buys 12 gallons of gas per week. Because of the run-up in prices, filling up weekly now costs roughly $40 a month more than last year. But the average weekly wage is up only $18 from last year. In other words, gas prices alone eat up more than half the average worker's wage increase.
Patrick DeHaan, senior petroleum analyst for a fuel-tracking website called Gasbuddy.com, says the higher gas prices are hurting consumers. "For people who have limited income, gas comes ahead of everything else — even if it means less food on the table," he says. That's because most people have no realistic alternative to driving to work and must purchase gas, he says, no matter what the cost.
Raises for cost of living haven't gone up despite corporate employers enjoying a 31 percent profit increase in the last quarter of 2010. Meanwhile, the national average for a gallon of gas is estimated to reach $4.05 by summer.