Giving Thanks & Decreasing Costs

A Thanksgiving meal for ten people in 2024 will cost almost 20% more than it did just five years ago. Since 1986, the cost of that same meal has risen from $28.74 to $58.08 – an increase of 102.1 percent.

Those increases are reflected in the chart below and are also why you are likely to hear at least one person complain about grocery prices today.

Source: Farm Bureau

The complaints are valid.  Groceries today cost more money and people hate that.  However, price and affordability are two entirely different things, and as strange as this may sound, groceries today are more affordable than ever.

How is that possible?

We buy things with money but pay for them with time.  Because wages have grown faster than inflation, it takes less time at work to buy the same groceries.  The chart below comes from a Human Progress Doomslayer blog post titled, Thanksgiving Dinner Will Be 8.8 Percent Cheaper This Year. 

Source: Doomslayer

To quote the article:

We should analyze the cost of a Thanksgiving Day dinner using time prices. To calculate the time price, we divide the nominal price of the meal by the nominal wage rate. That gives us the number of work hours required to earn enough money to feed those 10 guests.

According to the Bureau of Labor Statistics, the blue-collar hourly wage rate increased by 240.2 percent—from $8.96 per hour in October 1986 to $30.48 in October 2024.

Remember that when wages increase faster than prices, time prices decrease. Consequently, we can say that between 1986 and 2024 the time price of the Thanksgiving dinner for a blue-collar worker declined from 3.2 hours to 1.9 hours, or 40.6 percent.

That means that blue-collar workers can buy 1.68 Thanksgiving Day dinners in 2024 for the same number of hours it took to buy one dinner in 1986. We can also say that Thanksgiving dinner became 68 percent more abundant.

Prices may be higher, but Thanksgiving dinner in 2024 will be 8.8% less expensive than it was in 2023. If nothing else, this is another reason to be thankful.    

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On a personal note, this year I have a lot to be thankful for.  I get to spend most of my time with clients, colleagues, family, and friends who I love.  I get to write these notes. I get to nerd out on topics I’m insanely passionate about. My family is healthy and last weekend our 4th grade football team won the Lonestar Bowl. I couldn’t ask for more.

From my family to yours, Happy Thanksgiving.