The New York Times’ Gianna Smirek and Ben Casselman reported that high-income families stayed at home in the early stages of the pandemic, saving more and more as the value of stocks, homes and other assets rose. Between these stockpiles and solid wage growth, many were able to continue spending even as costs rose.
However, data and anecdotes suggest that low-income households are in greater trouble due to inflation, despite a resilient job market.
The Federal Reserve hopes higher interest rates will slow consumer spending and ease pressure on prices across the economy.there are already signs It means that poor families are reducing. If wealthier families don’t pull back as much, many prices could continue to rise as they continue to vacation, eat out, and buy new cars and second homes. may need to raise interest rates further.
In that case, poor families will almost certainly be hit again, as low-wage workers are often affected. lose time and work firstA polarized economy and the resulting policy decisions could be a double whammy for them, resulting in higher costs today and unemployment tomorrow.
“If the unemployment rate goes up, it’s a complete storm,” said Mark Brown, chief executive of the West Houston Department of Aid, which provides food, rental assistance and other forms of assistance to those in need. said. “So many people are very close to their limits.”
