Inflation – as measured by the consumer price index – recently reached its highest level in decades, topping out at 9.1% in June 2022. Though inflation has cooled slightly in the months since, consumer prices remain 7.7% higher in October 2022 than they were a year earlier, more than three times the Federal Reserve’s target 2% annual inflation rate.
Historic levels of inflation are having a meaningful impact on household finances. According to a report from the U.S. Congress Joint Economic Committee, the average American household spent $717 more in July 2022 than in January 2021, a 13.3% increase, due to the rising cost of living alone. In some states, inflation has taken an even bigger toll on consumers’ pocketbooks. (Here is what’s getting more expensive at stores in America.)
Using data from the JEC, 24/7 Wall St. identified the states hit hardest by inflation. We ranked all 50 states by the dollar increase in average monthly household expenses from January 2021 to July 2022. The JEC’s State Inflation Tracker aims to reflect how much more the average household must pay today to maintain the same standard of living as in January 2021, a month that predates inflationary pressures that began early that year.
Among the 50 states, inflation has driven up monthly expenses for the average household by anywhere from $556 to over $900 – or from 10.7% to 15.4%.
A recent survey from the U.S. Census Bureau found that rising prices are also taking a psychological toll. In every state, more than one-third of adults find inflation to be “very stressful,” and in 11 states over half of all adults do.
In each of those 11 states, the state inflation rate, as measured by the increase in monthly household expenses, between January 2021 and July 2022 exceeds the 13.3% national average increase. Residents of these states are also less likely to be equipped to absorb rising costs, as in each one, median household income is below the $69,717 national median, while the poverty rate is higher than the 12.8% national rate. (Here is a look at the states where Americans make the least money.)
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