Impact of Rising Gas Prices on Below-Poverty Commuters

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Abstract

While the increase in gas prices has increased costs for all commuters, workers from households whose income is below the federal poverty level pay a larger proportion of their income for gas. This fact sheet uses data from the 2006 American Community Survey to quantify the relative burden of gas use for commuting.

Introduction

While the increase in gas prices has increased costs for all commuters, workers from households whose income is below the federal poverty level pay a larger proportion of their income for gas. This fact sheet uses data from the 2006 American Community Survey to quantify the relative burden of gas use for commuting.

Findings

• The majority of workers, with incomes both above (78.9 percent) and below the poverty level (64.7 percent), commute to work by car, alone;
• Low-income commuters on average have slightly shorter commutes (19.5 minutes) than those with incomes above the poverty level (23 minutes);
• However, because their incomes are much lower, poor commuters spend a much higher proportion of their wages on gas (8.6 versus 2.1 percent at $4/gal);
• As gas prices double, the increase in costs represents a disproportionate increase in the burden for below-poverty commuters—from $2/gal, the increase takes 4.3 percent of income from below-poverty commuters and 1.0 percent from those above poverty;
• There are some variations in commuting times, income, and gas cost burden by race/ethnicity and geographic area, though the variations are much less than the gap between those above and those below the poverty line;
• The estimated numbers may actually understate the relative burden on the poor, since we assume exactly the same gas mileage for commuters in the two groups—if lower-income people tend to have older, less well-maintained (therefore, less fuel-efficient) cars, they will tend to get lower gas mileage.

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