Americans on average now need an additional $11,434 a year to afford the same standard of living they enjoyed in January 2021, according to CBS News.
While government data has shown that the average hourly rate of pay has increased 13.6 percent since January 2021, inflation has risen a whopping 17 percent during this same time period.
The impact of this wage-inflation gap is especially pronounced for low- and middle-income Americans, who spend a higher portion of their paycheck on basic necessities in comparison to those from higher income brackets.
Although the rate of inflation has slowed to 3.2 percent — notably lower than the 9.1 percent inflation rate increase recorded in June 2022 — it is still above the Federal Reserve’s target rate of 2 percent.
In addition to this, hearing that the inflation rate is “coming down” does not mean that things are becoming less expensive. Instead, it indicates that prices are just going up less quickly than they were before.
For example, a McDonald’s Big Mac costs 10 percent more today than it did in December of 2020. In May of this year, Cumberland Farms was forced to raise the price of its any-size coffee deal from 99 cents to $1.29 — a 30 percent price hike.
Similarly, Dollar Tree — once famous for its $1 price tag across the board — is now charging $1.25 for the vast majority of products.
Although Mainers are among some of the luckiest in the country in terms of the added cost of living over the past three years — coming in at an annual increase of $8,650, the second-lowest figure in the nation next to Arkansas — most residents are still finding it incredibly difficult to get by.
According to a University of New Hampshire (UNH) poll published over the summer, the majority of Mainers are having a hard time affording basic necessities and report being worse off financially than they were at the same time last year.
Sixty-four percent of respondents to the poll indicated that they were struggling either “a lot” or “somewhat” to cover the cost of things like food and utilities.
For Mainers between the ages of 18 and 34, this figure shoots up to 89 percent.
When asked about their expectations for improvement over the next twelve months, just 10 percent said that they believed they would be better off financially than they were at that moment — 44 percent said they felt they would be in an even worse position.
Given the financial strain experienced by so many Mainers and other Americans nationwide, it is perhaps unsurprising that the economy is at the top of voters’ minds going into 2024.
Much like those who answered the UNH poll, the vast majority of respondents in a recent Wall Street Journal indicated a belief that their personal financial situation has worsened over the past year.
Nearly one out of four people who were surveyed by the Wall Street Journal stated that the economy will be the most important issue for them when they consider who to support for president in 2024.
With Christmas fast approaching, financial strain also appears to be on the minds of many as they embark upon their annual holiday shopping.
According to an NBC poll, sales and promotions are more important than last year for nearly 2 out of 3 Americans.
Additionally, almost 40 percent of respondents said they planned to cut back in other areas of their life in order to cover the costs associated with the season.
Although it is expected that spending will be up this Christmas, it is nonetheless clear that inflation and other financial pressures will be on Americans’ minds as 2023 comes to a close.