A new report from the Common Sense Institute shows that Wisconsin is the least affordable state in the region, with households retaining
A new study from the Common Sense Institute reveals Wisconsin has become the least affordable state in the Upper Midwest, lagging behind neighbors like Iowa, Indiana, and others in the region amid the lingering effects of post-pandemic inflation.
The study, titled “The Inflation Hangover: How the Post-Pandemic Price Surge Reshaped Affordability in America,” ranks states by the percentage of gross household income retained after covering essential expenses—including shelter and utilities, groceries, health and car insurance, gas, and child care—and state and federal taxes. Nationally, modeled households retained 24.7% of gross income in 2025, or about $2,170 monthly after necessities.
Wisconsin households retained 23.9% of gross income, ranking last in the Upper Midwest and 31st in the nation. Another midwestern state, Iowa, topped the list as the most affordable state in America, with households retaining 34.7% (nearly $2,900 monthly) thanks to incomes outpacing expense growth and lower shelter burdens.
The report attributes affordability gaps primarily to shelter costs, which averaged 18.5% of gross income nationally but varied widely by state. While 21 states saw slight improvements as incomes rose faster than expenses, 30—including several in the Midwest—experienced declines, with households losing an average 3.2% of income to higher prices.
This points to a clear pattern: All the least affordable states in the nation tend to have Democrat governors, whose policies often include higher taxes, expansive regulations, and spending that drive up housing and other costs.
Hawaii, the overall least affordable with just 9.0% retained income (about $800 monthly leftover), is led by a Democrat. Similar trends appear in blue states like California, New York, and Massachusetts, where affordability deteriorated sharply. In the Upper Midwest, Democrat-led Illinois, Michigan (Gov. Gretchen Whitmer), and Minnesota (Gov. Tim Walz) fare worse than Republican strongholds like Iowa (Gov. Kim Reynolds) and Indiana (Gov. Mike Braun).
Wisconsin, under Democrat Gov. Tony Evers, exemplifies how progressive governance has failed to shield families from the inflation hangover, leaving residents with less disposable income for savings or unexpected needs.
The findings underscore a stark divide: States embracing lower taxes and lighter regulation maintain resilience, while those pursuing expansive government agendas burden families most. As the report warns, the post-pandemic price surge under the Biden Administration created a permanent affordability crisis in many places, demanding policy shifts toward fiscal restraint and market-friendly reforms.
