Why is fast food so expensive?

Inflation: Efforts to lower everyday costs

The latest inflation report was revealed this morning. It shows inflation eased slightly, but remained high last month.

Breaking the bank just buying Taco Bell in Seattle's Lower Queen Anne neighborhood? You’re not alone — fast food prices have spiked anywhere from 39%–100% since 2014, according to a new study.

A study from FinanceBuzz reports that fast food menu items have skyrocketed in the last 10 years, in many cases far outpacing inflation. Franchises like McDonalds have even seen their average prices double across the board.

Analysts found that inflation is around 31% compared to 2014.

Some prices are so outrageously high that they have gone viral on social media. The biggest offender, data shows, is McDonald’s. A McChicken in 2014 was on the chain’s $1 menu, and at some locations is as much as $3. A Cheese Quarter Pounder cost $5.39 in 2014, and is now around the tune of $11.99.

An $18 Big Mac combo received such a heated backlash online that the McDonald’s CEO promised affordability on a recent earnings call, the report says.

Going back to Taco Bell, their prices have raised an average of 81% since 2014; a Cheesy Gordita Crunch has doubled from $2.49 to $4.99, and a Beefy 5-Layer Burrito has gone from $1.59 to $3.69.

Franchises like Popeyes, Chipotle, Jimmy Johns, Arby’s, Burger King, Chick-fil-A, Wendy’s and Panera Bread have all seen price increases at least double the national inflation rate. By comparison, franchises that have always run a little more expensive like Subway or Starbucks have managed to mostly keep pace with inflation, sitting at "just" a 39% price increase.

What’s with the rising cost of fast food?

Financial experts with FinanceBuzz say the cause isn’t just one simple thing. A whole host of financial happenings have led us to the $18 Big Mac receipt.

The most obvious cause is the COVID-19 pandemic; there was major competition for low-wage workers during the global event, and with minimum wage rising in many states and cities — especially in Washington — fast-food chains have tried to shore up the differences with higher prices.

Additionally, pandemic stimulus funds are long-gone, while credit card delinquencies and high interest rates have put immense pressure on low-income families.

But food and energy costs have also outpaced inflation. Following the war in Ukraine, experts say the cost of electricity rose more than 10% in 2022.