Posted on 10/19/2007 6:17:22 PM PDT by festus
NEW YORK - The calculus of living paycheck to paycheck in America is getting harder. What used to last four days might last half that long now. Pay the gas bill, but skip breakfast. Eat less for lunch so the kids can have a healthy dinner.
Across the nation, Americans are increasingly unable to stretch their dollars to the next payday as they juggle higher rent, food and energy bills. It's starting to affect middle-income working families as well as the poor, and has reached the point of affecting day-to-day calculations of merchants like Wal-Mart Stores Inc., 7-Eleven Inc. and Family Dollar Stores Inc.
Food pantries, which distribute foodstuffs to the needy, are reporting severe shortages and reduced government funding at the very time that they are seeing a surge of new people seeking their help.
While economists debate whether the country is headed for a recession, some say the financial stress is already the worst since the last downturn at the start of this decade.
From Family Dollar to Wal-Mart, merchants have adjusted their product mix and pricing accordingly. Sales data show a marked and more prolonged drop in spending in the days before shoppers get their paychecks, when they buy only the barest essentials before splurging around payday.
"It's pretty pronounced," said Kiley Rawlins, a spokeswoman at Family Dollar. "It seems like to us, customers are running out of food products, paper towels sooner in the month."
Wal-Mart, the world's largest retailer, said the imbalance in spending before and after payday in July was the biggest it has ever seen, though the drop-off wasn't as steep in August.
And 7-Eleven says its grocery sales have jumped 12-13 percent over the past year, compared with only slight increases for non-necessities like gloves and toys. Shoppers can't afford to load up at the supermarket and are going to the most convenient places to buy emergency food items like milk and eggs.
"It even costs more to get the basics like soap and laundry detergent," said Michelle Grassia, who lives with her husband and three teenage children in the Bedford-Stuyvesant section of Brooklyn, N.Y.
Her husband's check from his job at a grocery store used to last four days. "Now, it lasts only two," she said.
To make up the difference, Grassia buys one gallon of milk a week instead of three. She sometimes skips breakfast and lunch to make sure there's enough food for her children. She cooks with a hot plate because gas is too expensive. And she depends more than ever on the bags of free vegetables and powdered milk from a local food pantry.
Grassia's story is neither new nor unique. With the fastest-rising food and energy prices since the 1980s, low-income consumers are stretching their budgets by eating cheap foods like peanut butter and pasta.
Industry analysts and some economists fear the strain will get worse as people are hit with higher home heating bills this winter and mortgage rates go up.
It's bad enough already for 85-year-old Dominica Hoffman.
She gets $1,400 a month in pension and Social Security from her days in the garment industry. After paying $500 in rent on an apartment in Pennsauken, N.J., and shelling out money for food, gas and other expenses, she's broke by the end of the month. She's had to cut fruits and vegetables from her grocery order — and that's even with financial help from her children.
"Everything is up," she said.
Many consumers, particularly those making less than $30,000 a year, are cutting spending on nutritious food like milk and vegetables, and analysts fear they're further skimping on basic medical care and other critical services.
Coupon-clipping just isn't enough.
"The reality of hunger is right here," said the Rev. Melony Samuels, director of The BedStuy Campaign against Hunger, a church-affiliated food pantry in Brooklyn.
The pantry scrambled to feed 5,000 new families over the past 12 months, up almost 70 percent from 3,000 the year before.
"I am shocked to see such numbers," Samuels said, "and I am really concerned that this is just the beginning of what we are going to see."
In the past three months, Samuels has seen more clients in higher-paying jobs — the $35,000 range — line up for food.
The Regional Food Bank of Northeastern New York, which covers 23 counties in New York State, cited a 30 percent rise in visitors in the first nine months of this year, compared with 2006.
Maureen Schnellmann, senior director of food and nutrition programs at the American Red Cross Food Pantry in Boston, reported a 30 percent increase from January through August over last year.
Until a few months ago, Dellria Seales, a home care assistant, was just getting by living with her daughter, a hairdresser, and two grandchildren in a one-bedroom apartment for $750 a month. But a knee injury in January forced her to quit her job, leaving her at the mercy of Samuels' pantry because most of her daughter's $1,200 a month income goes to rent, energy and food costs.
"I need it. Without it, we wouldn't survive," Seales said as she picked up carrots and bananas.
John Vogel, a professor at Dartmouth College's Tuck School of Business, worries that the squeeze will lead to a less nutritious diet and inadequate medical or child care.
In the meantime, rising costs show no signs of abating.
Gas prices hit a record nationwide average of $3.23 per gallon in late May before receding a little, though prices are expected to soar again later this year. Food costs have increased 4.5 percent over the past 12 months, partly because of higher fuel costs. Egg prices were 44 percent higher, while milk was up 21.3 percent over the past 12 months to nearly $4 a gallon, according to the Bureau of Labor Statistics.
The average family of four is spending anywhere from $7 to $10 extra a week — $40 more a month — on groceries alone, compared to a year ago, according to retail consultant Burt Flickinger III.
And while overall wage growth is a solid 4.1 percent over the past 12 months, economists say the increases are mostly for the top earners.
Retailers started noticing the strain in late spring and early summer as they were monitoring the spending around the paycheck cycle.
Wal-Mart and Family Dollar key on the first week of the month, when government checks like Social Security and public assistance generally hit consumers' mailboxes.
7-Eleven, whose customers are more diverse, looks at paycheck cycles in specific markets dominated by a major employer, such as General Motors in Detroit, to discern trends in shopping.
To economize, shoppers are going for less expensive food.
"They're buying more peanut butter and pasta. And they're going for hamburger meat," Flickinger, the retail consultant, said. "They're trying to outsmart the store by looking for deep discounts at the end of the month."
He said the last time he saw this was 2000-2001, when the dot-com bubble burst and the economy went into a recession after massive layoffs.
For now, low-price retailers are readjusting their merchandising and pricing.
Wal-Mart is becoming more aggressive on discounting. It announced Thursday it is expanding price cuts to 15,000 items, ranging from Motts apple juice and Progresso soups to women's fleece tops, heading into the holidays.
Family Dollar, whose food offerings were limited to candy and snacks until two years ago, has expanded its mix of groceries like fruit cups, cereal and such refrigerated items as milk and ice cream while cutting back on shoes. This summer the chain began accepting food stamps.
Food pantries are also getting creative. Samuels said her church, Full Gospel Tabernacle of Faith, just started offering free cooking classes to teach clients who are diabetic or have other health conditions how to prepare vegetables like squash. It's also offering free exercise classes.
"We are trying to make them health conscious," Samuels said. "It's not right to give them just anything. Our mantra is eat well and live well."
Most of the lard asses I see can afford to cut back a little bit—and that includes their obese (yet “hungry”) offspring. Of course, instead of shopping for nutritious food, they will shop for the cheap crap at the Dollar store. Of course, they will still find a way to buy lottery tickets and cigarettes at $7 a pack (thanks to Liberals).
Remember, according to Jane Fonda: “Poor people are poor because nuclear power plants are polluting the air.”
I called the local Ruth’s Chris Steakhouse this afternoon to see if I could get a reservation for a table of four, they had nothing before 9:30 PM either tonight or tomorrow. Maybe these economic geniuses at AP could explain this phenomenon.
True, but Bush was widely accused by Democrats and the MSM of "talking down the economy" while running for president in 2000. So, it was really his fault, even though Clinton was in office.
well festus, I won’t take it sentence by sentence for you, just the first one
“The calculus of living paycheck to paycheck in America is getting harder.”
if you don’t realize that many people are exactly living that way, you must be miles out of touch
I personally know many, the odd thing is, none of them are liberals either
Try going during the week and see if it's still booked.
sw
“While economists debate whether the country is headed for a recession, some say the financial stress is already the worst since the last downturn at the start of this decade.”
This author needs a history lesson on “tough times.” Check back to the Carter years. Yeesh!
The welfare bureaucracy feeds off the subsidization of a "hunger clientele." As many have observed, if you want more of something, including food stamp applicants and free lunch eaters, subsidize them and advertise for them. They will for sure show up. That's why this crap is laughable.
Walmart’s retail analysts have a better finger on the health of America’s economy than all of the overpaid Wall Street economists combined. I think a recession hits next year when the housing bubble slam really take effect and $100-$125 oil plus the spring gas switchover gives us $4 gas. It’s going to be on the news every night all summer and fall before the election.
That being said, all of these people live in very expensive urban areas and either rely on the government or are stuck in underpaying jobs by their own actions.
Peanut butter and pasta aint so bad. Go to North Korea where they eat dead pets and bark, or to Sudan, Chad, Ethiopia, Zimbabwe or Somalia where they have very little food and a lot of fighting genocide see if you have it tough.
It is tough if you can’t add.
Yep, it’s tough living paycheck to paycheck. I mean there is the plasma TV payment, the cable bill, the cell phone bills, the payments on two cars....etc.....
Yeah, That kinda happens when you keep raising taxes over and over and over and over and over and..................... well you get the picture.
Yup, that's what happens. I wonder what the solution could be?
.
See Post #26. We posted at the exact same time, with the exact same sentiments. :)
The other day I was driving by one our churches and there was a HUGE line around the building- I have to guess 200 people at least. It was food pantry day. I have never seen that many people lined up before. We just a free clinic in town now, one day a month. They are turning people away the crowds are so large. The busiest store in town is Goodwill. I live in a small town- 12,000 people, and it has decent employment, but prices are going up and salaries just aren’t here. Things are getting tough-that’s no joke. I don’t have much money either- but I know how to spend it well- I won’t have to skip breakfast to feed my kid.
I think that every leftist who thinks government should do something about this should be forced to adopt a family and support them for life.
“I don’t see any reason for laughing here”
The other day I was driving by one our churches and there was a HUGE line around the building- I have to guess 200 people at least. It was food pantry day. I have never seen that many people lined up before. We just got a free clinic in town , one day a month. They are turning people away, the crowds are so large. The busiest store in town is Goodwill. I live in a small town- 12,000 people, and it has decent employment, but prices are going up and salaries just aren’t here. Things are getting tough-that’s no joke. I don’t have much money either- but I know how to spend it well- I won’t have to skip breakfast to feed my kid.
I know a lot of those folks too. Funny thing, they were living the same way in the 90's.
Yeah, no doubt there are thousands who fit the profile. Out of 300 million. But I am sure you know all of them.
I shop for food just like everyone else. The prices are not rising much, if at all, if you shop intelligently. One big problem is that chronically poor people tend to be dull-witted, and make stupid purchasing decisions
“No competent adult needs to go hungry today in the USA, nor their children.”
Tell that to the ones that are, I’m sure they’ll appreciate your “compassion”. By the way, food isn’t dirt cheap and hasn’t been since I was a tiny child. This isn’t scare mongering, I see this in my town everyday. And it isn’t the obese, food stamp people. That’s a straw man that’s no longer valid.
Who the hell buys their groceries at 7-11? They jack the prices up like crazy! Store brand items are what I stock up with when I can. I’ve found that the Walmart Grocery Stores are the cheapest.
Quick quiz: What word is missing from this article on financial hardships for the working poor?
Three letters, beginning with “t” and ending with “x.”
Somehow the bleeding hearts of the people who write stories like this stop bleeding when it comes to the tremendous burden that local, state, and federal taxes put on the working poor, EITC or no EITC.
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