The ‘Happy Meal Indicator’: A McDonald’s Trend That Means the Economy Is in Trouble
Written by
Ellie Diamond
Edited by
Molly Sullivan
Commitment to Our Readers
GOBankingRates' editorial team is committed to bringing you unbiased reviews and information. We use data-driven methodologies to evaluate financial products and services - our reviews and ratings are not influenced by advertisers. You can read more about our editorial guidelines and our products and services review methodology.
20 Years
Helping You Live Richer
Reviewed
by Experts
Trusted by
Millions of Readers
Ordering a kids’ meal used to be a simple, nostalgic pleasure. Now, it’s a sign of a disturbing trend — adults getting priced out of adult-sized meals. In a recent survey by Lightspeed, 44% of adults reported ordering their own meals from the kids’ menu. For nearly one-third of them, it’s because the prices are more budget-friendly.
The Problem of Food Affordability
According to the consumer price index, which tracks affordability trends, the cost of food away from home has risen by 3.9% over the past year. Full-service meals and snacks have increased by 4.6%, while limited-service options, including fast food, are up by 3.2%.Â
While eating food at home can help you stay within your budget, even those prices are up by 2.7% since last year. Animal proteins — meat, fish and eggs — are the biggest culprits. Prices for that category are up a staggering 5.6%.Â
Why Is Food So Expensive?
Food prices are high because of a perfect storm of economic factors. Prices increased during the COVID-19 pandemic and never came back down. Rising fuel costs mean food takes longer to get to the stores, which end up charging higher prices to make up for the loss. Add weather events, international conflicts and agricultural crises, and it’s no surprise that prices are high.
While the CPI has dropped from its 40-year high of 8% year over year in 2022, it’s still up 26.7% overall since 2019, the last full year before the pandemic. General inflation adds to the compounding problem of food prices, forcing customers into a difficult position.
The Impact of Food Prices
As food becomes a heavier weight on people’s budgets, the costs of other necessities are also shooting up. For example:
- Shelter is up 3.6%.
- Medical care is up 4.2%.
- Transportation is up 3.5%.
These trends are hitting lower-income households the hardest. According to the U.S. Department of Agriculture’s Economic Research Service, households in the lowest income quintile spend approximately 33% of their income on food. Those in the middle spend about 14%.
The higher food prices climb, the harder it is for those with limited resources to be food secure. The USDA measures food security based on whether an individual or household has problems accessing proper nutrition.
In 2023, the most recent year for which the USDA has data, 18 million U.S. households had low or very low food insecurity, meaning food was of a poorer quality, not predictably available or both. That number represents 13.5% of the national population, compared to 12.8% in 2022.
What Help Is Available?
Government benefits can help some households struggling with low food security. In 2021, the USDA recalculated benefit amounts to keep up with inflation. Benefits increased by 21%, so recipient households’ buying power increased as well.
Updates are on a five-year schedule, which means another increase could happen in 2026. Meanwhile, ordering kids’ meals for themselves may continue to be another way adult consumers try to keep their buying power — along with their spirits — afloat.
More From GOBankingRates
