Recent research from the Federal Reserve Bank of New York indicates a significant rise in the number of Americans facing challenges in securing adequate food supplies over the past few years. This trend is likely influencing the historically low levels of consumer sentiment observed. The New York Fed has revised its 2020 analysis regarding the unequal financial impacts of the pandemic, incorporating newly gathered data from its prominent Survey of Consumer Expectations. More Americans are facing food insecurity now compared to May and June 2020, relying on savings to cover costs, struggling to access food, having children miss meals, or receiving food donations and federal assistance. “We find a remarkable increase in food insecurity, particularly among lower-educated and lower-income households and households with young children,” researchers stated on Wednesday.
Those same groups also reported heightened pessimism concerning their financial well-being. While not necessarily causal, the association between rising food insecurity and increased pessimism suggests a potential explanation for the persistently low levels of US consumer sentiment, even as economic data remains relatively resilient, if not robust, researchers observed. Income and wealth inequality have been a longstanding issue in the US; however, the economic experiences and outcomes for Americans have become markedly more disparate in recent years. This dynamic, frequently referred to as a “K-shaped” economy, is characterised by an increasing disparity in the spending, earning, and wealth accumulation patterns of lower- and higher-income Americans.
Individuals in the upper half of the K have experienced an enhancement in their household finances and wealth, driven by rising stock prices, increased equity in their homes, and a refinancing surge that has reduced mortgage payments and bolstered their savings. Those at the bottom of the K have faced increased financial stress due to rising living costs, post-pandemic inflation, and over five years of rapid price hikes. “The greater financial strain due to the high cost of living, combined with the expiration of pandemic-era aid (such as expanded benefits), have led to renewed concerns about food insecurity among those at the bottom of the K-shape,” New York Fed researchers wrote.
In February 2026, 10% of households surveyed reported insufficient food availability, marking an increase from 4% in June 2020, as per the data released on Wednesday. Shares of individuals receiving food donations rose to 15.8% from 10.6%, while participation in SNAP increased to 17.9% from 10.6%. Additionally, over one-third of respondents reported utilising their savings to meet expenses, with figures climbing to 36.8% from 21.8%. The New York Fed survey data was collected prior to the US-Israeli strikes in the Middle East, which later led to an oil supply crunch, resulting in a surge in petrol prices and exacerbating affordability issues.