Nearly two-thirds of middle-class Americans say they're 'struggling financially': poll

April CPI report shows inflation ticked downward

Thomas Savidge with the American Institute for Economic Research joins LiveNOW's Andrew Craft to break down the latest CPI report.

A majority of middle-class Americans are "struggling financially" and expect that to continue for the rest of their lives, according to a new poll.

The poll, commissioned by the National True Cost of Living Coalition and published last week, found that 65% of Americans considered "middle class" – or those earning above 200% of the federal poverty level – are facing financial hardship. That’s about $62,300 for a family of four, according to FOX Business.

Respondents included those with high school diplomas and graduate degrees as well as blue- and white-collar workers who live in both rural and urban America.

While many of these people said they are able to afford the most basic expenses, they expressed concern about their inability to save for the future. The poll found that 40% of Americans are unable to plan beyond their next paycheck, and 46% don’t have $500 saved for emergencies.

Eighty percent of Americans polled have at one time lived paycheck-to-paycheck.

FILE - A customer pushes a shopping cart outside a Kroger grocery store in Dallas, Texas, on Feb. 21, 2024. Photographer: Shelby Tauber/Bloomberg via Getty Images

"The economy is booming, and yet many Americans are still gasping for air financially," Jennifer Jones Austin, CEO of the Federation of Protestant Welfare Agencies and co-chair of the National True Cost of Living Coalition, said in a statement. "They simply don’t have the breathing room to plan beyond their present needs."

What causes inflation?

There are three factors that could lead to inflation which include demand-pull inflation, cost-push inflation and built-in inflation.

By many measures, the economy is healthy. The labor market is continuing to chug along at a solid but moderating pace with employers adding 175,000 new workers in April. Job openings remain high, and the unemployment rate has held below 4% for more than two years straight.

But Americans are also grappling with the highest interest rates in two decades and chronically high inflation that has made the cost of everyday necessities like groceries, rent and gasoline far more expensive.

While inflation has fallen considerably from a peak of 9.1% notched during June 2022, it remains above the Federal Reserve's 2% goal. And when compared with January 2021, shortly before the inflation crisis began, prices are up 17.6%, according to FOX Business.

Grocery prices are up more than 21% from the start of 2021, and shelter costs are up 18.37%, according to FOX Business calculations. Energy prices, meanwhile, are up 38.4.%.

Price hikes are particularly devastating for lower-income Americans because they tend to spend more of their already stretched paycheck on necessities and, therefore, have less flexibility to save money.

The typical U.S. household needed to pay $227 more a month in March to purchase the same goods and services it did one year ago because of still-high inflation. Americans are paying on average $784 more each month compared with the same time two years ago and $1,069 more compared with three years ago.

This story was reported from Cincinnati. FOX Business contributed.

Consumer Money U.S.