At the pump, 2011 has been the year of the big squeeze

It’s been 30 years since gasoline took such a big bite out of the family budget. The typical American household will have spent roughly $4,155 filling up this year—a record. That’s 8.4% of what the median family takes in, the highest share since 1981. Gas averaged more than $3.50 a gallon this year, another unfortunate record. And next year isn’t likely to bring much relief. In the past, high gas prices in the United States have gone hand-in-hand with economic good times, making them less onerous. Now prices are high despite slow economic growth and weak demand. That’s because demand for crude oil is rising globally, especially in the developing nations of Asia and Latin America. It puts the squeeze on the United States, where unemployment remains high and many people who have jobs aren’t getting raises. In 1981, when the economy was sliding into recession and oil prices were high because of Middle East turmoil, gas ate up 8.8% of the typical family budget. Over the past decade, gas has taken up 5.7% of the family budget. If families had spent only 5.7% of their income this year on gas, they would have saved $1,300. At the end of this year, gas likely will average $3.53 per gallon. That’s 76 cents more per gallon than last year and 29 cents more than 2008, when gas last set an annual record at $3.24 per gallon. Read the full story by The Associated Press here.