Consumer Comeback Blog

CareerBuilder: Fewer Americans Now Living Paycheck to Paycheck

A new survey by employment agency CareerBuilder finds that fewer people usually or always live paycheck-to-paycheck than have since the recession began in 2007. Currently 40% of American workers live paycheck-to-paycheck, down 6% since its high in 2008 and down 2% since 2011.

CareerBuilder surveyed 3,800 adults in May and June.

Of those who are currently living paycheck-to-paycheck, 53% did not do so until 2008. While one in five workers said they were unable to make ends meet at least once in the last year, 37% said they sometimes live paycheck-to-paycheck, and 23% said they never have to rely on a single check to make ends meet.

Income earnings are not necessarily a reflection of one’s ability to pay bills, according to the survey. Of workers who earn at least $100,000 annually, 12% always or usually live paycheck-to-paycheck, a decline from 14% in 2011 and 17% in 2010. Regardless of income, 72% of workers said they are more fiscally responsible now since the end of the recession.

Age is seems to be a better indicator of one’s likelihood to live paycheck-to-paycheck. Of workers 55 and older, 34% live paycheck-to-paycheck, making them the most financially stable group. Workers in the 45-54-year-old age range are most likely to live paycheck-to-paycheck, at 43%. Forty percent of 18-34-year-olds live paycheck-to-paycheck, as do 42% of 35-44-year-olds. Workers 55 and older are also more likely than any other age group to save more than $1,000 per month and to contribute to a retirement plan.

As paying bills becomes difficult, personal savings are often cut. The percentage of American workers who do not save anything, 27%, is as high as it was in 2011. One in 10 workers saves more than $1,000 per month; 30% save more than $250 per month. In 2011, 66% of workers contributed to a retirement plan; in 2012, 67% of workers do so, though 20% of workers have reduced their contribution in the last year.

Even in tough times, though, there are certain luxuries most American workers would be unwilling to give up. While 59% of those surveyed said they cut back on leisure activities, 57% would not give up the Internet; 44% would not give up driving; 39% would not sacrifice pet ownership; 29% would not give up cable television; and 24% would not give up their cell phones.