Welcome to the CNBC @Work newsletter, brought to you by CNBC Events. Think a friend, colleague or business partner should receive this newsletter? Subscribe here.
The Federal Reserve raised interest rates by 0.75 percentage points this week – the largest hike in nearly 30 years. This significant increase comes as the Fed tries to quell inflation without sending the economy into a recession. Although the Fed's action will likely bring prices down, the relief won’t be felt by consumers immediately.
While the economy is not technically in a recession, it is starting to feel like it for many Americans. Although wages have increased over the past year, it is not keeping pace with inflation. The increase in rent, food and gas prices is making it difficult for many workers to cover their expenses. In April, 61% percent of consumers reported living paycheck to paycheck and that number will likely increase as prices continue to remain high and borrowing costs go up as well. Surprisingly, 36% of employees earning $100,000 or more are also living paycheck to paycheck, doubling from 2019. In addition, a quarter of Americans are delaying retirement because of disrupted savings from this recent economic upheaval.
The effects of high inflation can be felt throughout the country and are also being factored into workplace strategies including those putting off retirement for now, workers asking to stay remote longer to offset high gas prices and a closer look at what standard-of-living wage increases mean in this current environment.
For more on the world of work, check out our Key Stories roundup below.
Until next time, stay safe, stay healthy and stay in touch.