From today’s annual report and press release from the American Farm Bureau Federation (AFBF) on the cost of a classic holiday meal “Survey Shows Thanksgiving Dinner Cost Up 14%“:
Enjoying Thanksgiving dinner with family and friends is a priority for many Americans, but paying attention to how the meal will impact the budget is also important. Farm Bureau’s 36th annual survey indicates the average cost of this year’s classic Thanksgiving feast for 10 is $53.31 or less than $6.00 per person. This is a $6.41 or 14% increase from last year’s average of $46.90.
The centerpiece on most Thanksgiving tables – the turkey – costs more than last year, at $23.99 for a 16-pound bird. That’s roughly $1.50 per pound, up 24% from last year, but there are several mitigating factors.
Several factors contributed to the increase in average cost of this year’s Thanksgiving dinner,” said AFBF Senior Economist Veronica Nigh. “These include dramatic disruptions to the U.S. economy and supply chains over the last 20 months; inflationary pressure throughout the economy; difficulty in predicting demand during the COVID-19 pandemic and high global demand for food, particularly meat,” she explained. Further, “The trend of consumers cooking and eating at home more often due to the pandemic led to increased supermarket demand and higher retail food prices in 2020 and 2021, compared to pre-pandemic prices in 2019.”
“Taking turkey out of the basket of foods reveals a 6.6% price increase compared to last year, which tracks closely with the Consumer Price Index for food and general inflation across the economy,” said Nigh.
Some comments:
1. Compared to $46.90 last year, the cost for a classic Thanksgiving Day dinner for 10 people this year is 13.7% higher at $53.31 (see blue line in top chart). Going back to 1986 when the AFBF annual survey started, the 13.7% increase in cost this year was the second-highest annual jump since a 16.8% increase in 1990. There were also double-digit increases of 13.2% in 2011 and 10.9% in 2007.
2. The average price for a 16-pound turkey this year ($23.99) is 23.7% (and $4.60) higher than last year’s price of $19.39, and the prices of 10 other food items on the menu are slightly higher than last year. The only item of the 12 products on the AFBF’s Thanksgiving menu that decreased in price since last year is cubed stuffing, which is 18.5% cheaper than last year.
3. Adjusted for inflation in 2021 dollars, the cost of a classic Thanksgiving dinner this year ($53.31) is only 7% more expensive than last year at $49.83, compared to the much larger 13.7% increase in current (nominal) dollars (see the brown line in the top chart). The significant difference in percent increases between nominal and real prices is because CPI inflation has gone up by 6.2% over the last year. In real, inflation-adjusted dollars the only other larger increases than 7% since 1986 than 7% were in 2011 (9.3%) and 1990 (9.8%), so this year’s increase is the third-largest in the history of the AFBF survey. But the real, inflation-adjusted cost of a Thanksgiving dinner this year at $53.31 is lower than any of the 12 years between 2007 and 2018, and also more affordable than any of the five years from 1986 to 1990 and seven of the nine years from 1995-2003.
4. Measured in the amount of time worked at the average hourly wage for all private production workers of $26.26 in October of this year (a year-over-year wage increase of 5.76%), the “time cost” of this year’s classic turkey dinner is only 2.03 hours, up from 1.89 hours last year. Importantly, even though the “time cost” is higher this year than 2020, it’s the second-lowest cost of a classic Thanksgiving dinner in the 36-year history of the annual AFBF report (see bottom chart above).
Compared to 1986 when the average American would have worked 3.21 hours to earn the income necessary to purchase the turkey dinner for 10, the “time cost” for a worker today at roughly only two hours is 37% lower. Another way to think about is that if the “time cost” of 3.21 hours hadn’t changed over the last 36 years, the cost of a Thanksgiving dinner this year would have been $84.29 instead of only $53.31.
Bottom Line: The fact that a family in America can celebrate Thanksgiving with a classic turkey feast for ten people for just over $5 per person and at a “time cost” of only two hours of work at the average hourly wage for one person means that we really have a lot to be thankful for on Thanksgiving: an abundance of cheap, affordable food despite the challenges of the pandemic, supply chain issues, and rising energy prices. The average American earns enough money by the time of his or her morning coffee break working on just one day to be able to afford the cost of a traditional Thanksgiving meal for ten. Compared to 1986, the inflation-adjusted cost of a turkey dinner today is 26% cheaper, and 37% cheaper measured in “time cost” for the average worker. Despite all of the hand-wringing and alarm bells about inflation, this year’s Thanksgiving dinner in America is among the most affordable of the past 36 years relative to our income and relative to the cost of in past years.
Happy Thanksgiving and bon appetit!
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