What Did the Average U.S. Household Spend for Food and Transportation in 2011?
My Friend the Cow by Lois Lenski.
National Dairy Council, 1946.
The BLS has reported average U.S. expenditure rates for 2011.
As compared to 2010:
(Note that I used the “food at home” category because it most closely reflects the cost of food purchased in the grocery store.)
In this section, I have taken food and transportation expenditures from the report and divided them by average annual income before taxes (provided by the report) to come up with the expenditure percentage for each category.
Using the calculations which follow, the average annual expenses in 2011 for food and transportation are 23.1% of before tax income for the average American.
Food average annual expense: 10.1% of pre-tax income. ($6,458 ÷ 63,685)
Food at home average annual expense: 6.0% of pre-tax income. ($3,838 ÷ 63,685)
Transportation average annual expense: 13.0% of pre-tax income. ($8,293 ÷ 63,685)
Gasoline and motor oil average annual expense: 4.2% of pre-tax income. ($2,655 ÷ 63,685)
From the report:
Expenditures on gasoline and motor oil increased 33.7 percent during the period, with a 24.5-percent increase from 2010 to 2011. The spending increase can partly be explained by the yearly rise in the price of gasoline during 2010 (+18.4 percent) and 2011 (+26.4 percent), as measured by the CPI-U.
(Note that the report categorized food stamps as income.)
The report divides consumers into five income quintiles. The middle 20% quintile earned between $35,645 and $58,272 in 2011, for a pre-tax income of $46,190, and an after-tax income of $45,563. This group’s average annual expenditures were $42,403.
This middle quintile group’s food and transportation expenditures were:
- 13.3% for food
- 8.2% for food-at-home
- 17.9% for transportation
This means that the middle (20% quintile) income American spends 31.2% of all expenditures for food and transportation. (Note that this is percent of expenditures, not percent of income.)
Today’s food expenditure numbers are modest when compared with historical figures. According to the WSJ, “In the 1960s, food spending was about 24% of all spending; in 1901, it was 43%, similar to patterns now seen in the developing world.”
Food and transportation costs increased more than three times as much as income in 2011.
As the dollar’s value goes down because of QE’s, our cost of imported oil and imported food goes up. Another policy, corn ethanol, is increasing the cost of domestic dairy, poultry, pork, beef, and wheat food prices.
QE’s and mortgage buy-backs are now deemed necessary by Bernanke to pay for our recent bank bailouts in this deleveraging process resulting from a central bank policy-induced housing bubble and unregulated financial innovation. Adequate banking regulation is still lacking, allowing for the possibility of more bailouts in the future.
Bubbles remain in health care spending and college costs while crony capitalism continues. Policy leading to today’s outstanding student loans which now equal a trillion dollars has contributed to the college cost bubble. Health care policy to date has not addressed sky-rocketing health expenditures adequately, either.
Thus, U.S. government policy is contributing to a lower standard of living for future Americans by placing a drag on GDP growth, job creation, consumer spending, and income distribution. Other factors, however, are also at play including changes in energy production and consumption patterns, advances in technology and communication, globalization, robotics, and increased efficiency in industries. Some of these provide a positive counterbalance for the negative influences.
BLS Reports here: