Caroline Sande of Hyde Park, used to spend $100 per week on groceries at the supermarket. Now that bill is $175
To make sure that she can pay her mortgage, and other bills, she now only goes to the supermarket once every two weeks.
Sande, a Boston Park Plaza Hotel housekeeper, said “Everything is going up except my pay,” She works five days some weeks and only two other weeks. “So I rob Peter to pay Paul. I save my money when I get paid, and then I pay my mortgage and car loan. Everything else comes later.”
She’ll probably have to continue doing that next year.
In the United States, both in homes and businesses, inflation is at its highest level in a generation. This increases financial pressures and forces people to adjust to new realities.
Friday’s government report showed that consumer prices rose 6.8% in the past year. This is the highest rate of inflation in 39 years. The largest price increases have occurred for essentials such as food and energy, housing and autos, and clothing. These are goods and services that millions of Americans rely on every day.
Lower-income households that have little or no cash cushion are particularly hard hit. This price rise has made it difficult for the Federal Reserve to reduce its assistance to the economy. It also coincided with a drop in public support for President Biden who has taken steps to lower inflation pressures.
“It hurts the middle class and working poor,” said Paul Diego Craney of MassFiscal spokeswoman.
The rapid rebound from the pandemic recession has fueled the rise in inflation. These factors include a flood government stimulus, ultra low rates engineered and shortages at factories. Manufacturers have been slowed by heavier-than-expected customer demand, COVID-related shutdowns and overwhelmed ports and freight yards.
In some cases, employers have raised wages to compensate for worker shortages. Many have also increased prices to increase inflation. This has led to price increases for everything from food and used cars to electronics, household furniture and rental cars.
Many grocery stores in Massachusetts are less crowded than before, due to a reduction in offerings by manufacturers while they deal with labor and material shortages. Reid advised shoppers to be ready for a reduced range and variety of products as they move into the new year.
As Americans stayed at home and flooded factories with orders, the pandemic caused an acceleration in prices. Now, it has spread to other services such as apartment rents, restaurant meals, and medical services.
Jason Furman, an economist at Harvard and ex-aide to the Obama White House, stated that the average American family has seen their costs rise by $4,000 over the past twelve months.