- A new statewide poll found a majority of Utahns living paycheck-to-paycheck.
- One-in-four survey participants are struggling to cover basic expenses.
- Inflation, slowing jobs market and government shutdown are causing financial stress.
A growing number of Utahns are facing mounting financial challenges thanks to a convergence of issues that include persistent inflation, a weakening U.S. jobs market and a federal government shutdown that has put hundreds of thousands out of work and threatened funding of critical programs.
Among those working to navigate the myriad fiscal hurdles are Emma and Bryan Mendez-Edwards, both college educated professionals whose previous stability is under fire amid the current economic climate.
“Bryan is a federal worker,” Mendez-Edwards said. “And I am currently working at the health department as an epidemiologist on a federal grant. So yeah, it’s been a crazy rollercoaster over here.”
A federal human resources employee, Bryan is currently on furlough and the Heber City couple are concerned the temporary work stoppage could become permanent.
“As this shutdown continues, he’s facing a potential federal workforce reduction,” Mendez-Edwards said. “My husband has only had seven, eight years — and we’re worried it will be a first-in, first-out layoff. That’s definitely been a cause for anxiety this year.”
The couple’s household budget is also under strain from increasing living expenses along with hefty student loan payments.
“The cost of groceries and utilities are continuing to rise,” she said. “With the new administration, the ending of the SAVE program (a federal program which helped limit the size of student loan payments), that’s also a concern for us at the moment with increasing student loan monthly costs.”
Mendez-Edwards says they’re making ends meet with her income and a side job that her husband has taken on. But more worrying times could be ahead.
“Luckily we do live in affordable housing, with a controlled mortgage, which has been very helpful at this time,” Mendez-Edwards said. “My husband is not getting paid, but I am a salaried worker and able to support us.
“But I think once we reach the end of November, things will become more stressful.”
And financial stress is an issue now facing a surprising number of Utahns.
How many Utahns are financially vulnerable?
A new Deseret News/Hinckley Institute of Politics poll of 809 registered Utah voters conducted Oct. 17-22 found a majority of people are living paycheck-to-paycheck and 1 in 4 have even more serious struggles.
When asked to choose the best description of their current financial situation, 51% of respondents said they were managing to cover expenses but faced difficulty saving money and 25% report they are financially strained and struggling to cover basic expenses. Less than a quarter of poll participants, 22%, say they’re financially secure and comfortably covering their living expenses.
The distribution of those who report facing the worst financial struggles is fairly evenly spread among Gen Zers, millennials and Gen Xers at 27%, 29% and 29%, respectively. But fewer baby boomers are feeling the pinch with 18% saying they are financially strained.
Among those reporting current financial security, Utahns in the baby boomer generation led the way at 36% with millennials the next best represented age group at 22%.
When asked to identify their biggest financial concerns of the moment, 23% of respondents said it was saving for the future, including putting away money for retirement; 19% listed paying for everyday expenses and 15% identified either managing debt or covering housing costs as their most significant financial challenge. Medical or health care issues are the top issue for 12% of poll participants and 8% said job security/income stability was their biggest worry.
The top financial concerns, by age group:
Gen Zers: Saving for the future
Millennials: Saving for the future
Gen Xers: Saving for the future
Baby boomers: Paying for everyday expenses
The poll conducted by Morning Consult for the Deseret News and Hinckley Institute of Politics has a margin of error of plus or minus 3 percentage points.
Looking out for those most in need
While financial struggles among Utahns are almost equally prevalent across age groups, those at the lowest economic rungs are at the most risk of being pushed to the brink. Emergency service providers like Crossroads Urban Center are at the front lines of the work to provide aid for those in most dire need.
Crossroads Urban Center executive director Glenn Bailey said demand for emergency food and basic needs has climbed sharply over the past several years — and the current federal government shutdown is making an already difficult situation worse.
“We’ve been seeing steady dramatic increases in the need for emergency food as well as stuff we give away at the thrift store for the last three or four years,” Bailey said. “With the government shutdown, people having less access to benefits, it’s not a good time to be in the emergency food business.”
Bailey noted that many clients turn to the food pantry only after exhausting other options.
“People are using the food pantry because they just paid the rent or a utility bill,” he said, adding that “less access to tuition assistance, thanks to budget cuts and shutdowns” are leaving people with fewer safety nets.
The Crossroads director said the center’s numbers show more families in need, though the overall demographics haven’t shifted much.
“Thirty percent of people we serve downtown are homeless, but we are seeing more families for sure, especially at our west-side facility,” Bailey said.
And he noted the change of season is set to elevate need to a “particularly acute” level.
“We stop 20–25 utility shutoffs a month with private funding," Bailey said. “We won’t get through the whole day on Nov. 1 (when the application window for help with utility bills opens) and it will be gone for the month. Cold weather, increased need, wanting to participate in the holiday can be a very tense time.”
Impact of housing costs, shaky jobs market
Phil Dean, chief economist at the University of Utah’s Kem C. Gardner Policy Institute, reviewed the new polling data and noted the responses underscore the financial pressure many Utahns are feeling, even as key economic indicators remain strong.
“My first thought after seeing a quarter of respondents reporting they are struggling to cover expenses is our current housing dynamic,” Dean said. “When you look at the housing data, we have about 30% of people paying more than 30% of their income on housing. Thirty percent is the standard affordability metric and if you are paying above that, you’re likely encountering broader financial challenges.”
Dean cautioned that financial stress doesn’t always align with relative income levels and even those earning well above the poverty level can find themselves in financial distress.
“The poll question is asking people’s sense of how things are going,” Dean said. “They may not meet the official poverty measure but still feel like things are really tight financially, including among middle-income levels as well.”
And the new Deseret News polling data reflects this dynamic. Among those who report struggling with everyday expenses, 17% have annual earnings in the $50,000 to $100,000 range and 11% earn over $100,000.
A weakening overall job market, along with slowing wage growth, is also playing a role in elevating financial challenges for Utahns. Dean noted that even while Utah’s unemployment rate, currently at 3.3%, is a full percentage point lower than the national average, opportunities to move up the income ladder via a new employment position are waning.
“You do see a bit of hunkering down by both employers and employees,” Dean said. “Nobody is hiring and nobody is firing. You don’t have the churn we saw over the last several years… and there are fewer options for those looking to make a change.”
Utah economy still growing
Even as household financial challenges are rising, Dean noted Utah’s economy is still outperforming most of the nation and is well positioned to weather the current dynamic.
“Utah’s economy is continuing to grow, but more slowly than we had been. I’d call it economic moderation,” Dean said. “But we’re still situated quite well relative to the rest of the country, even as we remain subject to all of the challenges that other places face.”
Mendez-Edwards and her husband are also seeing the positive amid their current economic challenges and say family support and optimism for the future have helped them stay grounded.
“We have very supportive families on both sides,” Mendez-Edwards said. “Being able to speak with them, vent, get financial support if needed. And, we both love what we do for a living.”