McDonald’s Price hikes Push Low-Income Americans Out of Reach of a Burger,Signaling Broader Economic Shift
NEW YORK – A once-ubiquitous American staple,the McDonald’s meal,is becoming increasingly unaffordable for low-income families,a trend analysts say reflects a wider squeeze on household budgets and a growing divide in consumer spending. McDonald’s itself attributes declining patronage among lower-income customers to rapidly increasing prices driven by rising costs for beef, labor, and other restaurant essentials.
The shift isn’t isolated to fast food. Across industries, from airlines to hotels, a clear pattern is emerging: as prices rise, lower-priced options are losing ground while demand for premium goods and services increases, highlighting the strain on those already struggling with the cost of living. This trend underscores the impact of inflation, rising interest rates, and lingering economic challenges following the COVID-19 pandemic on America’s most vulnerable households.
Between 2019 and 2024, the average price of McDonald’s menu items surged 40%. A Big Mac, for example, rose in price from $4.39 to $5.29 during that period, while a 10-piece McNugget set jumped from $7.19 to $9.19. McDonald’s management stated, “The rising cost of restaurant essentials such as beef and labor has driven up food prices,” adding, “This has driven out low-income customers who are already struggling due to rising living costs such as groceries, clothing, rent, and childcare costs.”
Several factors contributed to the price increases. While global liquidity during the COVID-19 pandemic initially fueled inflation, President Trump’s tariff policies added further pressure. The subsequent sharp rise in U.S. benchmark interest rates has also eroded the purchasing power of low-income individuals.
Data from VantageScore,a credit score modeling company,reveals a concerning trend: delinquency rates for households earning less than $45,000 annually surged after the pandemic and have remained elevated as 2022. High housing costs are a important contributor to the decrease in disposable income for these families.
The impact extends beyond McDonald’s. Delta Air Lines reported a 5% decrease in economy seat sales in the second quarter compared to the previous year, while premium seat sales increased by 5%. Similarly, market research from Costa shows luxury hotel brands like Four Seasons and Ritz-Carlton experienced a 2.9% sales increase this year, while sales of low-priced hotels declined by 3.1%.
“It is indeed becoming more and more difficult for low-income people to make a living every month,” noted Ricardo Vandebo, Chief Strategy Officer (CSO) and Chief Economist at VantageScore. Analyst Adam Josephson emphasized that the burden of rising costs is affecting a broad range of industries, not just food service.
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