Rising Cost of Essentials Slams Poor Families

Prices of "core" items are rising twice as fast as wages

By Jim O'Neill,  Newser User

Posted Mar 21, 2008 1:35 PM CDT

(Newser) – The rising price of essentials and sluggish growth in wages mean that inflation is hitting low- to middle-income families hardest, the Washington Post reports. Americans are paying 9.2% more for staples—groceries, gas, health care, etc.— than they did in 2006, nearly twice the pace of the growth in wages. Prices for luxury items—restaurant meals, new cars, etc.—are also rising, but not nearly as fast.

"The idea that you can understand the kind of budget constraints that middle-class families face by looking at overall inflation is wrong," said one economist. "You have to look at the core items a middle-class family buys." A family earning $45,000 is spending an average of $253 more on groceries per year, $378 more on gas, $204 on health care, and $38 to heat their home.

High gas prices are seen posted at a Shell gas station in Menlo Park, Calif.   (AP Photo/Paul Sakuma)
Graphic shows gas prices by state, compares national and California prices and national gas demand.   (AP Photo)
A man walks past a sign advertising gasoline prices Monday, March 10, 2008, in San Mateo, Calif.   (AP Photo/Ben Margot)
Food prices are rising faster than wages, pinching consumers.   (AP Photo/San Francisco Chronicle, Kim Komenich)
« Prev« Prev | Next »Next » Slideshow
To report an error on this story, notify our editors.

NEWS FROM OUR PARTNERS
Other Sites We Like:   The Street   |   MSN Living   |   PopSugar Tech   |   RealClear   |   24/7 Wall St.   |   Biography   |   Barstool Sports   |   OK!