Expanding the View of Affordability Beyond Inflation and Income Metrics

Recent analysis challenges the common narrative that inflation since 2021 has impoverished most Americans. Traditional economic indicators like real income adjusted for the Consumer Price Index show increased purchasing power compared to pre-pandemic levels. However, these measures overlook factors such as high borrowing costs and subdued employment growth, which contribute to economic challenges beyond simple income and price comparisons. Economic affordability extends beyond purchasing power to include elements of economic inclusion, security, and perceptions of fairness. Affordability concerns arise when individuals cannot access goods and services that enable full societal participation, face financial vulnerability from unexpected setbacks, and perceive pricing practices as unfair or exploitative. These broader factors help explain lingering economic dissatisfaction despite measured income gains.