Affordability Concerns Continue to Rise

People shop at a grocery store in Brooklyn on December 12, 2025 in New York City.

Spencer Platt | Getty Images News | Getty Images

Affordability has been a source of household frustration and a key focus of political discourse in recent months, as prices for everyday goods and services continue to rise.

“People are yelling about affordability,” said Martha Gimbel, executive director and co-founder of the Budget Lab at Yale University. “I think it’s very obviously become a political flash point,” she said.

Understanding the Inflation Rate

The inflation rate has throttled back from its peak in 2022, when it hit a roughly 40-year high of 9.1%, as measured by the annual consumer price index. It was 2.7% in November 2025.

But the everyday prices that consumers pay remain much higher than they were before the Covid-19 pandemic. The CPI — which measures how quickly prices are rising for a basket of goods and services — has risen 26% in the past six years.

Put another way: The inflation rate since Q4 2019 has risen about twice as fast as the Federal Reserve’s optimal rate, according to Mark Zandi, chief economist at Moody’s.

Impact on Consumer Spending

But prices have risen even faster for many items that are consumer staples or impact overall quality of life, economists said.

That’s true for categories like housing, groceries, electricity, dining out, car repairs and used cars, for example, according to CPI data.

Businesses generally don’t cut prices — so prices have risen in absolute terms even as inflation has decelerated, albeit less quickly, according to economists.

Political Climate and Affordability

“It is the case that wages have been outpacing inflation in recent years, that our living standards are just higher than they used to be,” Gimbel said. “On the other hand, it is simply the case that certain categories of spending are more emotional for people,” she said.

A University of Michigan poll published in December shows that high prices remain a pain point for consumers. About 46% blame high prices for poor personal finances — among the highest shares since the series started in the late 1970s.

Perceptions of Affordability Among Democrats and Republicans

However, affordability is also somewhat influenced by the “fractured” political climate, he said.

For example, Politico’s poll shows a big gap in perceptions among Democrats and Republicans.

About 82% of people who voted for former Vice President Kamala Harris in the 2024 presidential election said the cost of living has gotten worse over the past year, according to the survey. Meanwhile, 45% of voters for President Donald Trump said the same.

Factors Contributing to Affordability Concerns

High prices since the Covid-19 pandemic are a byproduct of many factors.

At a high level, a mismatch between supply and demand drove prices upwards rapidly, according to economists.

The government pumped trillions of stimulus dollars into the U.S. economy to prop up household spending, and consumer demand exploded when the economy reopened broadly in early 2021; meanwhile, the Covid-19 health crisis choked supply chains, limiting supply to meet that demand. Businesses rushed to rehire workers, pushing up wage growth — and prices — especially in service-oriented sectors.

Looking Ahead to 2026

Affordability may remain a top concern heading into 2026, too.

Enhanced premium subsidies for 22 million Americans enrolled in health insurance via the Affordable Care Act marketplace are poised to disappear at the end of 2025, leading insurance premiums to more than double for the average recipient.

Vehicles under repair at an automotive shop in Oklahoma City, Oklahoma, on Dec. 12, 2025.

Nick Oxford/Bloomberg via Getty Images

Smart Tip for Readers

To better manage affordability concerns, consider tracking your household expenses and creating a budget that accounts for rising prices, and explore resources such as the Here for more information on managing finances during times of inflation.