In the lead-up to the first presidential debate, both President Joe Biden and former President Donald Trump have been urging voters to ask themselves the question made famous by Ronald Reagan: Are you better off than you were four years ago?
With the economy among the top issues for voters, each candidate has been using their own set of data points to create a favorable economic picture of their time in office. But for many voters, the answer will vary greatly depending on their geography, profession, age, race and lifestyle — not to mention the political lens they see each candidate through.
Hourly workers, especially those in food service and hospitality, have seen significant wage gains to help offset inflation. But retirees and full-time caregivers have been unable to take advantage of a strong job market. Homeowners have seen their wealth grow amid soaring home prices. But prospective buyers have had to contend with rising rents and interest rates. White households have benefited the most from record stock prices compared to Black and Hispanic households, which have fewer investments in the stock market.
“It all kind of depends on where you sit,” said Julia Pollak, chief economist for ZipRecruiter. “Income inequality has narrowed while wealth inequality has widened. Wages have grown for low wage workers, but have been stagnant for a lot of white collar workers.”
But while there isn’t one story of the U.S. economy, NBC News looked at several key categories that most directly affect households to show how those indicators have changed in recent years and the effect those could have on voters.
Wages
Over the past year, wages have started to increase faster than prices after about two years of consumers seeing their buying power decreased by inflation that was going up faster than their wages.
Now, consumers are largely left with the same buying power they had four years ago rather than having seen real income gains over that time that would have helped bolster their financial picture.
Since the start of the pandemic, prices — as measured by the Consumer Price Index — are up nearly 21% and wages over that time are up just over 22%, according to federal data. But while consumers have made up some ground, the inflation-adjusted wage growth of around 1% that consumers saw over the past four years is what they typically would have seen in a single year prior to the pandemic, said Pollak. For many workers, a salary raise has just enabled them to keep up with their expenses rather than improve their lifestyle or feel like they are getting ahead financially.
Some workers have been bigger winners than others with hourly workers, particularly those in leisure and hospitality, seeing the biggest wage gains while white-collar workers and managers have been less likely to see their pay keep up with rising prices.
“Wages are finally, after two years, exceeding the average rate of inflation,” said Joseph Davis, global chief economist for Vanguard. “That’s good news, that’s why the economy continues to expand. But I think where there’s tensions is that wages aren’t growing at the same rate across the income spectrum.”
Jobs
Helping drive those wages up has been a historically strong job market where demand from employers has outstripped the supply of people willing or able to do those jobs. The unemployment rate has fallen from 6.4% when Biden came into office to 4% in May after dropping to as low as 3.4% last year, the lowest in more than five decades. During Trump’s four years in office, unemployment also steadily declined to 3.5% before surging during the pandemic to nearly 15%.
There are around 1.5 jobs open for every one person looking for one. The strongest hiring has been in health care, retail, transportation and warehousing. Construction has also seen a hiring boom from billions in federal dollars for infrastructure, clean energy and semiconductor projects.
But there are indications that worker leverage is weakening with job openings on the decline since 2022, said Pollak.
“Hiring is quite slow,” said Pollak. “If you don’t have a job or if you have a job that you don’t like then it’s a tougher labor market because there is less hiring going on.”
The outlook for the job market also varies by race with the unemployment rate at 5.6% for Black workers and 5% for Hispanic workers.
Housing
While unemployment is historically low and wages have ticked up over the past year, housing remains one of the biggest economic pain points for consumers renting or trying to buy a home.
The affordability gap — an estimate of the difference between an area’s median household income and how much income is necessary to afford payments on a median-priced home in that area — is near a 10-year high in the U.S., according to an NBC News analysis of housing data.
A household earning the local median income would be able to afford a home in more than 60% of counties nationwide, according to the NBC analysis. Five years ago when Trump was in office, that typical household would have been able to afford a home in just over 90% of counties.
“Wage growth isn’t going up at the same rate as the average home price over the past two years,” said Davis. “So home buyers are losing ground there even though the labor market is tight. That’s why affordability is really low, affordability for a new home for first time homeowners is among the lowest on record.”
Rents have increased 31% since the start of the pandemic to an average of nearly $2,000 a month, according to Zillow. The median household spent slightly over 29% of their income on rent in April compared to just under 28% before the pandemic.
While the rising interest rates and home prices have been a negative for those looking to purchase a home, homeowners have seen their net worth soar from higher home valuations.
But other housing-related costs have also been increasing for some homeowners. Insurance rates have increased an average of 23% since 2023 with homeowners in Nebraska, Colorado and Arizona seeing some of the largest increases. Higher home values can also mean higher property taxes for homeowners.
Food
With the typical household spending about 11% of their disposable income on food, consumers have said that rising grocery prices have taken a particularly painful toll on their budgets. Food prices have risen around 25% over the past four years while Biden was in office. And while prices aren’t increasing as much as they were in 2022, they continue to rise.
Grocery store prices increased 1.1% in April compared to a year ago and restaurant food was up 4.1%, according to the Bureau of Labor statistics. The rise in food prices has disproportionately impacted lower-income households, which spend around a third of their discretionary income on food, according to a 2022 Agriculture Department survey.
While price increases have slowed and the cost of some items have come down from their peak, prices for many key items are still well above their pre-pandemic levels. The price for a pound of ground beef has gone from $3.87 before the pandemic to $5.15 in May, a pound of bacon has gone from $5.50 to $6.81, a dozen eggs has risen from $1.50 to $2.70, bread has increased from $1.38 to $1.97, and a gallon of milk is up from $3.20 to $3.87, according to data from the Federal Reserve.
But there are some indications prices could start to come down more broadly. Major retailers and restaurant chains have announced recent price cuts, including Walmart, Aldi, Target, McDonald’s, and Applebee’s.
The Biden administration has argued that those higher prices are being offset by rising wages, especially for hourly workers. A White House analysis this month said that for the average non-managerial worker, it now takes the same hours of work to buy a typical basket of groceries as it did in 2019.
Gas
Gas prices are an ever-present metric of the economy for most consumers each time they drive past a gas station or fill up their tanks. Consumers were hit with a surge in gas prices in 2022 after Russia’s invasion of Ukraine roiled energy markets, sending the average price for a gallon of gas up to $4.62. Prices have been coming down over the past two years to an average of $3.42 as of June 17 — 12 cents lower than a year ago and the lowest level since 2021.
But average prices are still above their pre-pandemic levels, when a gallon of gas was around $2.45 in February of 2020.
A key factor keeping prices higher than their pre-pandemic levels is a pullback in production from OPEC, an organization of leading oil-producing nations, said Patrick De Haan, head of petroleum analysis for GasBuddy.
Helping offset OPEC’s tightening of production is a record amount of oil being pumped in the U.S. Despite a push by the Biden administration to transition away from the use of fossil fuels, U.S. oil production has been at its highest level on record over the past year, surpassing the previous record set in 2019.
Prices typically peak in the spring when refineries are undergoing maintenance and should continue to go down throughout the summer and fall unless a hurricane disrupts refinery production.
“If we can make it through without any major events this summer, then prices would continue to potentially see a little bit of downward momentum. Of course, that’s also subject to OPEC policy not changing,” said De Haan. “Typically, gas prices fall in the fall, just as they spring in the spring. There’s going to be a lot of conspiracy theorists saying ‘oh, this is happening because of the election’ on both sides of the aisle. But they failed to remember that economics is what drives prices and the balances of supply and demand.”