Where are grocery prices hurting most? States with highest (and lowest) costs

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Grocery prices were on the rise well before the national egg shortage. In the past five years, grocery prices have increased nearly 25%, according to the USDA.

But where in the country are consumers feeling the pinch the worst?

Personal finance website WalletHub analyzed the prices of 26 common grocery items in 50 states, then added the costs and compared them with the median household income to determine where people are spending the greatest percentage of their income on groceries.

In what states do consumers spend the most on groceries?

Here are results from WalletHub's analysis, looking at the states where shoppers spend the highest percentage of income on groceries:

1. Mississippi (2.64%)
2. West Virginia (2.57%)
3. Arkansas (2.49%)
4. Kentucky (2.41%)
5. Louisiana (2.39%)
6. New Mexico (2.36%)
7. Alabama (2.34%)
8. South Carolina (2.27%)
9. Tennessee (2.23%)
10. Oklahoma (2.21%)

The top states correspond with the states where the median income is the lowest in the country, said Chip Lupo, writer and analyst for WalletHub.

"While the cost of these groceries is probably lower than you would expect in maybe California or in the Northeast, the numbers are higher because they have less income to spend on those groceries," Lupo told Paste BN.

For instance, Mississippi's median annual household income is just under $53,000, which is below the national average of $74,600, Lupo said. Compare that to New Jersey, which comes in at No. 50, or the state with the least percentage of earnings used on groceries. The average median income there is $118,000, he said.

The prices of groceries was analyzed in January, so they do not account for the latest price spikes in egg prices because of a nationwide shortage caused by a bird flu outbreak, Lupo said.

"You could probably expect spikes all across the board in all 50 states" for egg prices, he said.

Grocery prices were up 1.9% in January from 1.2% in January 2024, according to the latest Consumer Price Index figures, Paste BN has previously reported. Prices were up 0.5% from December, the largest month-over-month increase since October 2022. Eggs had the largest monthly price jump, up 15.2% after the H5N1 bird flu disrupted egg production.

Where is the lowest percentage of income spent on groceries?

41. Hawaii (1.68%)

42. Colorado (1.67%)

43. Virginia (1.66%)

44. Minnesota (1.66%)

45. Utah (1.63%)

46. Connecticut (1.62%)

47. New Hampshire (1.60%)

48. Massachusetts (1.54%)

49. Maryland (1.54%)

50. New Jersey (1.50%)

Regional differences in grocery price impacts

Not everyone feels the sting of rising food prices equally, said David Ortega, a food economist and professor at Michigan State University.

"It is low-income households who are hit the hardest, as they spend a larger share of their disposable income on food," Ortega, who is not affiliated with the WalletHub survey, told Paste BN. "These are the individuals who are having to make real adjustments in order to be able to put food on the table. Similarly, in states where median incomes are lower, grocery costs take up a greater portion of household budgets, making price increases more financially straining."

Food price inflation varies by region, Ortega said, partly because of differences in retail operating costs like labor and rent, which are often passed on to consumers through higher prices.

Variations in consumer shopping habits and demand for specific foods can influence inflation rates across regions too. Transportation costs also play a role: Areas farther from food production, ports and distribution hubs may face higher prices because of shipping expenses, he said.

Can't find eggs?: Are consumers stockpiling eggs? What to know about egg shortage

Will grocery prices stay high?

Although grocery inflation or the rate of price increases has moderated, prices remain high, Ortega said, and inflationary pressures persist because of factors like the effect of bird flu on egg and poultry prices, extreme weather events affecting food production, and rising labor costs. There is also a great deal of uncertainty surrounding key policies of the Trump administration, such as tariffs and mass deportations, which could further drive up food prices.

Tips to save on grocery bills

Here are some tips from Ortega to stretch a budget at the grocery store:

1. Plan ahead and make a list. Taking inventory of what you already have in your pantry and fridge before creating a detailed grocery list can help keep spending in check and avoid impulse purchases.
2. Choose store brands. Opting for store-brand items can often reduce costs without sacrificing quality.
3. Look for deals and sales. It can pay off to shop around and take advantage of advertised deals to save money.
4. Don't assume bulk deals are always better. Though bulk purchases can save money in the long run, they aren’t always the best option; you might end up with food that goes bad before you can use it.
5. Eat before you shop. Avoid grocery shopping on an empty stomach. This often leads to impulse purchases and unnecessary spending.

Betty Lin-Fisher is a consumer reporter for Paste BN. Reach her at blinfisher@USATODAY.com or follow her on X, Facebook or Instagram @blinfisher. Sign up for our free The Daily Money newsletter, which will include consumer news on Fridays, here.