Over the last several months, McDonald’s has continually drawn ire from consumers and media outlets over its increase in prices. We’ve heard stories of $7 Egg McMuffins and $18 Big Mac meals, all while McDonald’s has become a middle-class luxury rather than a cheap option to eat out for anyone, regardless of their income. Because McDonald’s is a franchiser, most local restaurants are controlled by local owners, not corporate entities. While there are clear brand standards that are set by McDonald’s, pricing and menu variation are possible from location to location. Franchise owners have complained about inflation, including an increase in the cost of products and services for their locations, and these prices have been passed along to customers.
While it makes sense for business owners to protect their profit margins, McDonald’s franchise owners risk permanently losing a portion of their customer base. The Consumer Price Index Inflation Calculator from the Bureau of Labor Statistics can be used based on the above chart to see if McDonald’s price increases accurately match the change in inflation.
Let’s look at these 7 menu items and their prices from 2014, and what they would be had McDonald’s only adjusted for inflation.
McChicken Sandwich: 2014 $1.00; 2024 $2.99. $1.00 adjusted for inflation in 2024 = $1.34
McDouble Sandwich: 2014 $1.19; 2024 $3.79. $1.19 adjusted for inflation in 2024 = $1.60
Medium Fries: 2014 $1.59; 2024 $3.79. $1.59 adjusted for inflation in 2024 = $2.13
Quarter Pounder w/Cheese Meal: 2014 $5.39; 2024 $11.99. $5.39 adjusted for inflation in 2024 = $7.22
Oreo McFlurry: 2014 $2.39; 2024 $4.49. $2.39 adjusted for inflation in 2024 = $3.20
10 Piece McNugget Meal: 2014 $5.99; 2024 $10.99. $5.99 adjusted for inflation in 2024 = $8.03
4 Piece McNugget Happy Meal: 2014 $2.99; 2024 $4.99. $2.99 adjusted for inflation in 2024 = $4.01
7 Meal Total: 2014 $20.54; 2024 $42.43. $20.54 adjusted for inflation in 2024 = $27.53.
Based on this chart (assuming it’s an estimate for McDonald’s across the U.S.), we know that prices have increased for all 7 meals at about 106.57%, from $20.54 to $42.43. $20.54 has the same buying power in 2014 as $27.53, which means McDonald’s is charging $14.90 more for these 7 meals than inflation would estimate. Adjusted for inflation, prices have increased about 54.12%. Let’s assume the dollar has the same purchasing power in 2024 as in 2014, and look at a price increase of 54.12% for all 7 meals.
McChicken Sandwich: 2014 $1.00; 2024 $1.54
McDouble Sandwich: 2014 $1.19; 2024 $1.83
Medium Fries: 2014 $1.59; 2024 $2.45
Quarter Pounder w/Cheese Meal: 2014 $5.39; 2024 $8.31
Oreo McFlurry: 2024 $2.39; 2024 $3.68
10 Piece McNugget Meal: 2014 $5.99; 2024 $9.23
4 Piece McNugget Happy Meal: 2014 $2.99; 2024 $4.61
7 Meal Total: 2014 $20.54; 2024 $27.53
In 2014, the median household income was about $52,000. Today, that number is around $77,283, an increase of 48.62%. Adjusted for inflation, $52,000 in 2014 has the same buying power as $69,702 today. This means that the median household income has beaten inflation. However, McDonald’s price increase beats the household median increase (subtracting inflation from both).
Bloomberg first reported the $5 meal launch on 5/10, and many have criticized the burger franchise’s response as too little too late. We know that prices in the U.S. today are as high as ever, and McDonald’s is no different. Is McDonald’s response to their super-sized pricing enough to bring customers back?
While McDonald’s price increases are something that we should all be on the lookout for, it’s vital to continue to manage your budget well. Eating out several times a month or week can quickly become a drain on your finances. For more help on budgeting, check out the resources below.
The Starter Budget
Beginner Starter Plan for Financial Wellness
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