Workers are unable to contribute as much to the economy in 2024.
A lmost two-thirds of US-based workers are spending less money because they are worried about layoffs, according to career website Zety's Financial Habits and Health Survey. The 2024 Wells Fargo Money Study confirms the public's fears. More than two-thirds of the 3,606 US citizens surveyed said they have cut back on spending this year. Less than half of the respondents feel like they are in good or great financial shape. Those attitudes are a direct result of thousands of layoffs in the US in the first five months of 2024, specifically in the technology industry (which includes a 121-person team at Apple).
Inflation in the US has also been a factor in workers reducing their spending. The US Department of Labor reports that consumer prices continued to rise through the first couple of months of the year. In fact, the Consumer Price Index for All Urban Consumers increased 0.3 percent in January and again by 0.4 percent in February. Most respondents said inflation has affected their spending habits.
Almost half of the 1,000 workers in Zety's survey also chalk up their spending anxieties to financial instability. Forty-two percent said their financial situation is less stable than it was in 2023.
In addition, 45 percent of workers believe they are underpaid, and 26 percent of respondents consider themselves very underpaid. Only 10 percent said they are overpaid. Many people rely on annual bonuses to compensate for their salaries. However, 18 percent of respondents to Zety's survey did not receive a bonus in 2023. Disappointment exists on the other end of the spectrum as well: Fifty-one percent of employees reported receiving a bonus, but it came as an "unpleasant surprise" because it was lower than expected.
"Lack of financial stability and income-related fears negatively influence our overall well-being," says Dominika Kowalska, career expert at Zety, in a statement. "It's clear the overall economy and cooling labor market have caused many [people] to become less confident about their employment and financial situations."
According to Zety's survey, the top financial challenges employees face in 2024 are contributing to a savings account, maintaining the same standard of living as in 2023, paying bills on time, and paying credit card debt.
Only 12 percent of respondents reported not having any financial struggles.