Inflation Outpaces Wages, Straining Middle and Lower-Income Households
For months, Americans have voiced frustration over the stubbornly high cost of living. However, economists are now warning of a more troubling shift: consumers are increasingly reporting that their incomes are not keeping up with growing financial pressures.
Joanne Hsu, director and chief economist of the University of Michigan’s Surveys of Consumers, highlighted that this change is becoming more evident in recent readings. “Consumers have been expressing frustration from high prices consistently for the past several years. What makes this season different is that consumers are also increasingly mentioning weakening incomes,” Hsu told Fox News Digital.
The growing strain is backed by data from the Bank of America Institute, which notes that inflation has grown faster than middle- and lower-income households’ after-tax wages since January 2025. As a result, nearly one in four U.S. households is now living paycheck to paycheck, a number that has increased during the past year.
This growing financial pressure is presenting a political challenge for President Donald Trump, who returned to the White House on promises of improved affordability. He is now facing skepticism from voters about whether he can deliver on these promises.
A Fox News national survey shows that 76% of voters now rate the economy negatively, a sharp increase from 67% in July and 70% at the end of former President Joe Biden’s term. Trump’s economic approval has also slipped to a new low, with his overall job approval reaching record levels of disapproval, even among his historically supportive base.
For now, the daily reality for many Americans remains the same: prices feel too high, paychecks feel too thin, and confidence in the future is fragile. How quickly this situation changes and whether voters assign credit to Trump for any improvements may shape the tone of the country’s economic and political discourse in the coming months.