Closing the growing income-necessity gap for working Americans

The gap between what Americans earn and what they need to achieve a basic standard of living is growing according to a new analysis. The Ludwig Institute for Shared Economic Prosperity finds that for the bottom 60% of U.S. households, maintaining a "minimal quality of life" is out of reach. While the economy is officially thriving based on indicators like GDP and unemployment rates, these measures do not reflect the reality for most Americans who are working harder yet unable to get ahead. From 2001 to 2023, the cost of economic security doubled as housing, healthcare, and education expenses surged while median earnings for lower-income households fell. This disconnect is expected to widen further if wages continue lagging behind rising costs of basic necessities. Policies are needed to strengthen earnings for working families, control costs, invest in public goods, and reduce income inequality that undermines economic mobility and opportunity.