You Are Spending $900 More Per Year on Gas Than in 2009

In the years since economy tanked, Americans have been driving fewer miles in their cars and buying more fuel efficient vehicles. Unfortunately, that hasn't spared them much pain at the pump. According to a new report from the EIAthe average household now spends 4 percent of its annual pre-tax income on gasoline, up about a percentage point from 2009. That translates to roughly $2,900 a year, or $900 more annually. As a point of comparison, a month's rent averaged $1,048 nationwide by the end of 2012.

EIA_Household_Gas_Spending.png

This is partly a story of scarcity beating efficiency. World demand for oil has surged back since the recession, pushing up fuel prices faster than motorists can cut back on their road time or upgrade to higher MPG vehicles. But another factor at play here is stagnant incomes. Oil and gasoline prices stayed low in the 1990s as household earnings rose. The last decade saw the opposite trend -- real mean incomes dipped about 6 percent from 2001 to 2011 -- so that the average household now spends two percentage points more of its income fueling up than a decade ago. 

To put that rise in perspective, it's about the same as the payroll tax hike that economists believe could shave as much as 0.6 percent off of GDP growth this year. Of course, some of the money Americans spend on gas gets plowed back through the economy through corporate profits. So that's a silver lining of sorts, at least if you work for Exxon. 

Presented by

Jordan Weissmann is a senior associate editor at The Atlantic.

Why Is Google Making Human Skin?

Hidden away on Google’s campus, doctors at a world-class life sciences lab are trying to change the way people think about their health.

Join the Discussion

After you comment, click Post. If you’re not already logged in you will be asked to log in or register with Disqus.

Please note that The Atlantic's account system is separate from our commenting system. To log in or register with The Atlantic, use the Sign In button at the top of every page.

blog comments powered by Disqus

Videos

Why Is Google Making Skin?

Hidden away on Google’s campus, doctors are changing the way people think about health.

Video

How to Build a Tornado

A Canadian inventor believes his tornado machine could solve the world's energy crisis.

Video

A New York City Minute, Frozen in Time

This short film takes you on a whirling tour of the Big Apple

Video

What Happened to the Milky Way?

Light pollution has taken away our ability to see the stars. Can we save the night sky?

Video

The Pentagon's $1.5 Trillion Mistake

The F-35 fighter jet was supposed to do everything. Instead, it can barely do anything.

More in Business

Just In