The financial burden on American households due to inflation has been starkly highlighted in recent reports, showing that an average U.S. family now requires an additional $11,434 annually to maintain the standard of living they enjoyed before inflation soared to 40-year highs under President Joe Biden’s administration.
A CBS News Moneywatch analysis, utilizing government data, compared the costs of living from January 2021 to the present, underscoring the struggle families face in keeping up with inflation. Although average hourly wages have risen by 13.6% since early 2021, this increase has been outpaced by a 17% hike in inflation during the same period.
The major pressure points for increased spending are basic necessities such as food, housing, transportation, and energy. These essentials make up about 80% of the surge in expenditure, as per a report from Republican members of the U.S. Senate Joint Economic Committee.
The report chose January 2021 as a baseline because it was the last month before inflation began its upward trend, coinciding with President Biden taking office. Particularly hard-hit are households in the Mountain West region, including states like Colorado, Utah, and Arizona, experiencing some of the highest inflation rates. For example, Colorado families are projected to face an additional cost of $12,065 in 2023, surpassing the national average.
Washington, D.C., households are not spared, with anticipated extra annual costs of $13,460 from November 2022 to November 2023, significantly higher than the national average.
These figures paint a troubling picture of the economic challenges faced by American families. The gap between wage growth and inflation has led to a decreased standard of living, with the most significant impact on essential living expenses. The data starkly illustrates the real-world impact of inflation on everyday Americans, posing a serious challenge to the current administration’s economic policies and strategies.