Nearly Half of U.S. Households Couldn’t Afford Basics in ‘24

A staggering 45.5% of U.S. households did not earn enough to cover their basic necessities in 2024, according to a landmark report from the Brookings Institution. The finding means that only 55% of American families were able to make ends meet last year, painting a grim picture of the nation’s deepening affordability crisis.

Released on May 27, the “States of Affordability” report introduces a standardized measure that compares household incomes against the cost of essentials — housing, food, childcare, healthcare, transportation, and utilities — across every U.S. county. The results reveal a problem that is both widespread and structural, affecting families from coast to coast.

A Decade of Struggle

This is not a new crisis. According to the report, more than 40% of households have struggled to make ends meet in nearly every year since 2014. The only exception was during 2021 and 2022, when pandemic-era stimulus checks and expanded tax credits temporarily boosted post-tax incomes, allowing more families to stay afloat.

But that relief proved fleeting. As those federal programs expired and inflation surged in 2022, the share of households able to cover their needs dropped by a full 10 percentage points in just two years, erasing most of the gains made earlier in the decade. As NPR reported, the economic health of American households “relapsed” when the social safety net shrank just as millions of families were moving closer to the financial edge.

The Income Side of the Story

Andre Perry, director of Brookings’ Center for Community Uplift, emphasized that the affordability debate has focused too narrowly on inflation. “My main takeaway is that when we talk about affordability, we’ve been focusing on inflation,” Perry told NPR. “But there’s the income side of the story that we often do not talk about.”

The numbers bear this out. In 2024, national wages grew by just 1.3%, well below the inflation rate of 2.9% that year, according to Census Bureau data. Meanwhile, the federal minimum wage has been frozen at $7.25 per hour since 2009 — a fact that the report highlights as a major contributor to the crisis.

The report calculates that 37.9 million households could make ends meet if wages increased by $10 per hour. An additional 10 million households could be lifted out of financial distress if costs decreased by $500 per month. “It’s dramatic, in the sense that we’re not doing that [raising wages],” Perry said. “But can we do it? Yes.”

Racial Disparities and Geographic Variation

The affordability crisis falls disproportionately on communities of color. In 2024, 55% of households of color could not afford to make ends meet. Black and Hispanic workers earned just 78 cents for every dollar earned by white workers, according to Bureau of Labor Statistics data cited in the report.

Geographic variation is also stark. The best-performing states — Colorado, North Dakota, South Dakota, New Hampshire, and Washington, D.C. — saw over 60% of households making ends meet. At the other end of the spectrum, fewer than 50% of households could manage in New York (48.4%), California (49.3%), Oregon (47.3%), West Virginia (47.2%), Louisiana (49.8%), and Kentucky (49.9%). Hawaii ranked lowest, at just 39%.

The K-Shaped Economy

The report arrives amid what economists describe as a “K-shaped economy,” where upper-income households increasingly earn and spend more while lower-income families fall further behind. Data from the Bank of America Institute shows that high-income households saw 6% wage growth in April 2026 compared to a year earlier, while low-income earners saw just 1.5%.

Hannah Stephens, a senior research assistant at Brookings’ Center for Community Uplift, stressed that the solution requires addressing structural costs. “In order to actually solve affordability, we have to deal with these larger, most structural costs that are harming households,” she said. “The solution isn’t just about raising wages — it’s about tackling the root causes of unaffordability.”

Current Pressures and the Road Ahead

The report does not include 2026 data, but recent trends suggest the situation may have worsened. Gas prices have surged 50% since the war against Iran began in late February 2026. The Consumer Price Index stood at 3.8% in April 2026, well above the Federal Reserve’s 2% target. And food insecurity has reached pandemic-era highs, according to a separate Federal Reserve Bank of New York survey also released on May 27.

The findings carry significant political weight ahead of the November 2026 midterm elections, where 36 governors and hundreds of state lawmakers will be on the ballot. Affordability remains the top concern for voters across party lines, and the Brookings report provides a powerful tool for assessing economic performance at the state and local level.

As the “States of Affordability” series continues, Brookings researchers plan to explore the specific drivers of unaffordability — from housing and healthcare costs to childcare and transportation — and offer policy recommendations for state leaders. For the 45.5% of American households currently unable to make ends meet, the question is whether those solutions will arrive in time.