- Item by item, we reveal what consumers are paying right now, and what they SHOULD be paying were it not for 12 months of runaway 9.1% inflation
- Comprehensive analysis by DailyMail.com found the 45 products that were most frequently burning a hole in the pockets of the average urban shopper
- Price rises for gasoline (59.9%) are well known, but many everyday items have jumped: Among them, eggs are up 33.1%, chicken up 18.6% and men’s suits are up 24.9%
- The typical U.S. household $5,915 cost spike is a hefty rise for households on the median income of $67,521
- Families have cut back on everything from Friday-night treats to groceries and travel to make ends meet
- Analysts blame everything from Biden’s spending spree and supply chain snarl-ups to the war in Ukraine and sanctions on Russia roiling global food and energy markets
- Is inflation hurting your family? Write to James.Reinl@mailonline.com
The typical American household will spend $5,915 more on everyday items this year than in 2021, with inflation running at a 40-year high and stinging prices at gas pumps and grocery store checkouts, DailyMail.com can reveal.
Householders are spending nearly $493 more each month to buy the same items they were buying a year ago, said Moody’s Analytics economist Mark Zandi, who studied the latest U.S. government price data.
He called this a ‘big deal for a household making about $60,000 per year’. The median household income in the U.S. is $67,521.
Consumers across the U.S. told DailyMail.com how they have struggled to put food on the table after inflation reached 9.1 percent — its highest rate since the 1980s — meaning cutbacks on basics such as butter and beefsteaks.
In another sign of economic strain, the U.S. slipped into a recession after Thursday’s announcement of a second straight quarterly decline in economic turnover.
The Federal Reserve raised its key interest rate by 0.75 percent on Wednesday to battle high inflation, putting the brakes on the economy and making it harder to repay mortgages, credit cards and other debt.
Experts blame everything from President Joe Biden’s spending spree and supply chain snarl-ups to the war in Ukraine and sanctions on Russia roiling global food and energy markets.
Against this gloomy economic backdrop, DailyMail.com examined the latest data from the government’s Bureau of Labor Statistics (BLS) and found the 45 items that were most frequently burning a hole in American pockets.
We then calculated how much the same items would cost had inflation stayed at the Federal Reserve’s target 2 percent rate — not the runaway hikes we’ve seen this past year — to indicate ‘normal’ prices for the same items.
Our table shows how consumers are spending additional hard-earned dollars on everything from pantry staples like eggs, bread and baby food to used cars, furniture and board games.
DailyMail.com researched prices of everyday items and calculated how much they would cost had inflation stayed at the Federal Reserve’s target 2 percent rate — not the runaway hikes we’ve seen this past year — to find out how much extra consumers are currently paying
Some of the biggest hikes are well known — gasoline has jumped by 59.9 per cent, and air fares by 34.1 percent, according to BLS.
But other everyday items have also soared in price, including eggs (33.1 percent), margarine (34.5 percent) and chicken (18.6 percent).
Take coffee, as an example. BLS data show that roasted ground coffee sells for $5.79 per pound, as a nationwide average. This past year, the price of coffee has risen 16.8 percent.
Had inflation been under control, that same pound of coffee would sell for $4.70, meaning consumers are losing out to the tune of $1.09.
The same goes for an ordinary men’s suit, which now sells for $349.00. These have risen by 24.9 percent, meaning the same two-piece should really cost $267.34, and shoppers are spending an extra $81.66 for the same item.
This all adds up, and particularly hurts low-income families. The median household income was $67,521 in 2020, according to the U.S. Census Bureau.
There are some exceptions. The cost of televisions has dropped by 12.7 percent and for smartphones by 20 percent, often because of promotional deals to stop demand from waning.
But overall, 2022 has been costly for the average American, and wages are not keeping pace.
As a result, families have cut back on everything from entertainment to groceries and travel to help make ends meet.
About a third are using their credit cards more to fill the gap.
Shoppers in Alhambra, California, this month. The DailyMail.com table shows how consumers are spending additional hard-earned dollars on everything from pantry staples like eggs, bread and baby food to used cars, furniture and board games
Inflation in the U.S. rose to 9.1 percent in June, the highest since 1981 and above what economist had predicted
Biden speaks about the inflation reduction act as costs skyrocket. One householder in Illinois told DailyMail.com that her family was sweltering in the summer heat, unable to afford the air conditioning. Some are not visiting loved ones because gas prices remain high at above $4.30 per gallon.
Nearly two thirds of Americans have changed their motoring habits since March, the American Automobile Association aid in a survey on Monday — by driving less, carpooling and other cutbacks.
Inflation is the top issue for 24 percent of Americans, according to a YouGov poll on Tuesday. Rising prices were far ahead of the runner-up priority, jobs and the economy, at 12 percent.
The high cost of living has pushed 29 percent of Americans to take up a side hustle — from selling clothes online to taking paid online surveys — according to Insuranks, which ranks insurance firms.
Experts blame inflation on everything from supply chain issues to the war in Ukraine’s impact on food and energy markets. Still, high prices have doubtless hurt Biden’s approval rating, which has sagged to about 37 percent.
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They also hurt retailers. Walmart has slashed its profit outlook, citing the impact of higher prices on shopping habits, and McDonald’s and Chipotle Mexican Grill say customer trade is down.
Online retailer Amazon lost $2 billion in the second quarter, but said it expects a jump in third-quarter revenue, pushing its shares up 13 percent in trading after the bell on Thursday.
The Federal Reserve announced on Wednesday that it would increase interest rates by 0.75 percent, pumping the federal interest rate to 2.33 percent as the central bank tries to control surging inflation.
The rate hike will cause interest rates on mortgages, credit cards and all types of loans to go up, causing monthly bill payments to soar and hurting Americans’ ability to repay debts.
While interest on savings will also see a small increase as high as 2 percent, it would do little to relieve consumers amid the rise in cost of living.
The Commerce Department on Thursday said the US economy had contracted for the second quarter in a row, meeting the classic definition of a recession.
Gross domestic product shrank 0.9 percent in the second quarter, following a decline of 1.6 percent drop in the first quarter.
Another inflation measure, the personal consumption expenditures price index, soared 6.8 percent in the 12 months through June, the biggest increase since January 1982.
The White House has challenged the notion that six months of economic contraction was a recession, pushing its message that the economy remains strong.
Biden said in a statement that ‘it’s no surprise that the economy is slowing down as the Federal Reserve acts to bring down inflation’.
‘But even as we face historic global challenges, we are on the right path and we will come through this transition stronger and more secure,’ he added.
Many economists and analysts have traditionally defined a recession as two consecutive quarters of GDP contraction. But the official private research group that tracks U.S. recessions looks at other indicators, including jobs and spending.
John Leer, the chief economist at Morning Consult, an analytics firm, predicted more pain ahead, saying ‘inflation will likely remain elevated at least through the summer given its current momentum and its spread from goods to services’.
HOW FAMILIES ACROSS THE U.S. ARE MANAGING THE CRUNCH
Gas prices make softball away game trips for 18-year-old Idaho twins too costly
Jennifer Liebrum’s family have had to cut back on driving long distances across Idaho, meaning softball away games for 18-year-old twins Devon and Gracie are in the rearview mirror
Jennifer Liebrum, 56, from Bellevue, Idaho, who works with special needs children, and husband Tyler Peterson, 51, a farrier, used to enjoy driving their twin 18-year-old daughters Devon and Gracie around the region for softball matches.
The sporting vacation trips came to an end when the cost of a full gas tank shot up from $70 to $160. Their household income is $50,000-$100,000.
‘They canceled the team, because we’re not the only ones in the predicament,’ said Liebrum.
An SUV now idles in the driveway. The family increasingly gets around by walking and cycling in an effort to ‘get through this crunch’, she added.
Groceries used to cost $100 a week, but a recent haul of two days’ supplies was $170 — prices that left Liebrum feeling like she was ‘going to a jewelry store’.
Even driving 60 miles to the nearest Costco to load up on more affordable produce stopped making sense due to gas prices.
‘We’re considering getting chickens again, which I hate,’ she joked.
‘We’ve been getting ready to launch two girls into life. And now those savings are for survival.’
They are the sixth generation to live in the valley and ‘part of the pioneer group that established this place’, said Liebrum.
Billionaires like Elon Musk, Jeff Bezos and Bill Gates descend on the area in private jets each year for the nearby Sun Valley Conference, a networking extravaganza for tech and media moguls.
Once-a-month filet mignon treats are out for New Jersey family
Thomas Crowell’s New Jersey family is struggling with inflation and the couple’s retirement plans have been pushed back, but the wedding of son Connor, 25, at the end of the year is a highlight on the calendar
Thomas Crowell, 58, a benefit consultant from Forked River, New Jersey, says he has ‘cut back on splurges’ like the tasty filet mignon stakes he and wife Chris, 57, an administrative manager, used to savor each month.
Even by avoiding meat and poultry, weekly grocery bills of $250 have risen to ‘well over’ $300 and filling the gas tank has shot up from $45 to $70, said Crowell. The household income is between $100,000-$150,000.
Their son Jack, 21, lives at home, but Connor, 25, moved to Nashville, Tennessee, and is getting married later this year.
The Florida and Caribbean holidays the family previously enjoyed are in the rearview mirror.
‘We would go out to mom-and-pop restaurants three times a week, we’ve cut back on that,’ said Crowell.
Worse still, the couple’s retirement savings have been ‘eaten away’ as stock values are ‘demolished’, said Crowell.
‘We do not know how long or deep this recession will be,’ he said.
‘When’s it going to be possible for us to retire?’
The country is ‘paying the price’ for overspending early on in the Biden administration, he added.
California couple switch European vacations for relatives on East Coast
Megan Aaron, 36, has been struggling with gas, food and daycare costs for daughter Harper, two, but says the family is still ‘lucky’ to be able to make their rent and put food on the table
Megan Aaron, 36, a theater worker from Los Angeles, California, husband Tim, 43, a paralegal, and daughter Harper, two, did not have expensive vacations in Spain or Mexico this year.
Instead, the family holiday was to a relative’s home in Massachusetts.
Weekly grocery bills shot up from $170 to $220 and gas prices in California are among the highest in the country.
Daycare for Harper at $1,400 per month takes a big bite out of the $100,000-$150,000 household income.
To make ends meet, Aaron is more careful about using up leftovers. She visits her hairstylist less often and has reverted to her natural brunette locks without highlights to save cash.
‘It has been really challenging,’ said Aaron.
‘Cutting out the luxury things that we just can’t do anymore.’
Downsizing to one car has been ‘logistically challenging’, she added, but the bigger problem is how the unstable economy makes it tougher to buy a home and plan for the future.
‘We’re very lucky that we’re able to afford our rents, daycare and the big expenses. We’re not in fear of being homeless or not being able to put food on the table,’ she said.
‘But it does make our lives a little more uncomfortable.’
Pizza parlor trips nixed as Maryland family hunker down for months of belt-tightening
Summer camp was cancelled this year for 11-year-old twins Daniella and Natalya Neubauer and their family. Instead of jetting off overseas for a summer vacation, the Neubauers spent a week at the Delaware shore
Family outings to the pizza parlor were the first casualty of the financial crunch for Sigurd Neubauer, 41, an online publisher from Maryland, his wife Hannah, 45, a doctor, their 11-year-old twins Daniella and Natalya and son, Cyrus, four.
The twins have to skip summer camp this year as prices have ‘skyrocketed through the roof’, said Neubauer. The household income is $100,000-$150,000.
Average camp costs have more than doubled to $178 a day from about $76 last year — putting them out of reach for many Americans.
International travel was off this year, and the summer vacation was a week spent on Delaware’s beaches.
The dad-of-three is skipping his morning visits to Starbucks and is brewing coffee at home instead.
Mum and dad both drive hybrid cars, meaning a full tank rose only from about $25 to $40.
While cutting back on restaurants, the family has focused on healthy activities like tennis and swimming.
‘This economy is going to be with us for a long time,’ said Neubauer.
He blames inflation on geopolitics and global food price hikes and other ‘structural problems that every American president would have to deal with’.