Ground Beef Now Costs More Than the Federal Minimum Wage

The cost of a kilogram of ground beef has reached a maximum. Depending on where you shop, groceries may cost more than the federal minimum wage.

Money analyzed beef prices at seven of the most popular grocery chains across the US, and found that 1 pound of 20% lean beef costs between $6.49 and $8.96. Organic, grass-fed and lean varieties tend to be more expensive.

On the other hand, the federal minimum wage remains at $7.25 an hour.

The US Department of Agriculture estimates that the average American eats about 60 pounds of beef each year. Widely available and easy to prepare, ground beef serves as a grocery staple for many families, and lately, prices have been on the rise.

According to the latest inflation data, the average price of a pound of lean beef is $8.34. On Friday, the USDA reported that the cheapest type of ground beef was $5.41 per pound on average, while ground beef patties cost about $8 per pound.

The increase in the price of beef is largely due to the ongoing cattle crisis. According to a blog post from the American Farm Bureau Federation, beef cattle counts have reached their lowest point since 1961. Farmers are dealing with severe drought and infectious diseases that are decimating their herds. Yet consumer demand remains strong, and that translates to higher shelf prices.

As grocery costs continue to squeeze budgets, low beef prices — like gas prices — serve as a common source of sticker shock for consumers.

Federal minimum wage vs. beef prices

The federal minimum wage has not decreased since July 2009, when it reached $7.25. This 17-year suspension is the longest in US history.

At the time of the $7.25 national minimum wage, a pound of ground beef cost about $2.20 per pound, meaning that one hour of work could buy more than three pounds of beef — enough to make a dinner or two for a family of four.

Now, it can cover one.

Beef prices rising above the minimum wage is a sign of greater progress. Excluding tipped workers, about 82,000 Americans earn $7.25 an hour. According to the National Conference of State Legislatures, 33 states and Washington, DC, have set minimum wages above the state floor.

DC, for example, has the highest minimum wage in the country, at $17.50 an hour.

Still, rising beef prices represent a hurdle many Americans are experiencing as the cost of daily living rises.

As of 2020, grocery costs have risen more than 31%, and there is no sign of slowing down. In fact, experts see the opposite. Iran’s ongoing war is disrupting trade routes around the world, which has threatened fertilizer shortages, while oil prices have risen nearly 50%.

Both of these issues can contribute to higher prices at the checkout counter.

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