Economist Writing Every Day

Farm Bureau has released their annual data on the cost of a Thanksgiving meal. The headline is that this meal has declined, in nominal terms, for 2 years in a row — back-to-back years of roughly a 5 percent decline. That’s good news for consumers. But they note it’s not all good news, because the meal is still 19 percent higher than 2019, “which highlights the impact inflation has had on food prices – and farmers’ costs – since the pandemic.”

However, the news is even better than they say. If we compare the price of this meal to median earnings, it is actually cheaper than it was in 2019. It’s now the second most affordable Thanksgiving on record, and the only lower year was 2020 — an anomalous year for many reasons (prices fell, due to decreased demand, while median wages were artificially lifted by lower-wage workers losing their jobs).

As a percent of median weekly earnings for full-time workers, the Farm Bureau Thanksgiving meal will cost just 5 percent of weekly earnings (note: I use 3rd quarter earnings for each year, since it is the latest available for 2024). In 2020 it was only 4.7 percent, but other than that 2024 is lower than all other years for which we have data, which goes back to the mid-1980s, when it took 6-8 percent of earnings to buy this meal.

Last year I also said that this meal was the second cheapest ever — if you ignore the weird years of the pandemic. But now if you ignore those years, it is the most affordable it has ever been.

That’s something to be thankful for next week, but also every time you go to the grocery store. Since October 2019, average wages have increased more than prices at the grocery store — not by much, but still better than you might suspect (and yes, I have checked my receipts). If we go back to the 1980s, wages beat inflation by a much larger margin.