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U.S. drivers spent more earnings on fuel in 2012 than 30 years ago

Despite fewer miles driven and more fuel-efficient cars, expenditures on gas climbed to an average 4 percent of income for U.S. households.

By Douglas Newcomb Feb 4, 2013 12:56PM

High gas prices in March of 2012 in California. Photo courtesy of Flikr user basykes
If you think you spent more on gas last year -- even if you drove less or bought a new, more fuel-efficient vehicle -- you’re not alone. According to Energy Information Administration estimates, gasoline expenditures in 2012 for the average U.S. household climbed to just below 4 percent of income before taxes, which represents $2,912 spent at the pump.


The federal agency said that this rise represents the highest estimated percentage of household income spent on gasoline in almost three decades.


But while overall gasoline consumption has decreased in recent years, thanks in part to fewer miles driven and higher fuel efficiency from new cars, average gasoline prices reached record highs in 2012. And no surprise -- overall household gas expenditures were much higher last year, too.


The EIA pointed out that the last time the percentage of household income spent on gas for cars exceeded 2012 levels was in the early 1980s, when it topped 5 percent. And while miles traveled by car per household have greatly increased since the early '80s, rising fuel efficiency has helped reduce the amount of gasoline used per mile.


The EIA also credits recent fuel-efficiency gains for causing total U.S. gasoline consumption to fall to 134.2 billion gallons in 2011, its lowest level since 2001. But at the same time, the average city retail gasoline price as tracked by the EIA jumped by 26.1 percent in 2011, and by 29.4 percent in 2012, when it reached a peak of $3.70 per gallon. This offset the effect of reduced consumption on the part of consumers. As a result, gasoline expenditures grew to a record annual average of $2,655 per household in 2011, and rose even more in 2012.


To make matters worse for the average commuter, the increases in fuel costs outstripped any rises in personal income. The EIA said that the 26.1 percent yearly increase in 2011 in estimated gasoline prices was six times greater than the 3.4 percent rise in nominal household income, while the additional 3.3 percent rise in 2012 outpaced a paltry 2.9 percent estimated increase in income last year.


U.S. gasoline expenditures in 2012. Image courtesy of U.S. Energy Information Administration.

[Source: Energy Information Administration]

3Comments
Feb 4, 2013 7:20PM
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Sadly, our paychecks decreased at a just as scary rate with the 2013 tax rates.
Feb 5, 2013 9:41AM
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I dumped my 2 gas guzzler SUV's in the last 2 years and I am saving a bundle on gas, insurance and upkeep.  Not to mention no car payments!!  With my savings wife and I are planning on buying another small vacation home in the next 2-3 years. 
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