Your Raise Could Get Eaten Up Next Year Before You Can Spend It
Changes made now can slowly help ensure inflation rates don’t climb to detrimental levels, but it’s multi-stepped, and time consuming.
There have been many factors at play over the last two years that have seriously complicated life: from COVID-19 to really polarizing politics, the bonkers housing market, and an economic freefall from the pandemic has led to lots of struggles trying to make ends meet. Unfortunately, another element is now at play that could impact families again – rising inflation.
According to New York Times, inflation rates have jumped to the highest level in close to 40 years. Data released this week points to rising housing costs, supply chain disruptions, and rapid consumer demand have all led to “fuel the strongest inflationary burst in a generation.”
According to the Consumer Prince Index, the number jumped by 6.8 percent this year through November. It’s the fastest-paced rise since 1982. “After stripping out food and fuel, which can move around a lot from month to month, inflation climbed by 4.9 percent. That was the quickest annual reading since 1991,” New York Times reported.
It’s important to note that the rise in inflation is just one part of a multifaceted national economy. In other words, there have been good things, too — like widespread wage growth and companies offering better pay and job perks to keep their workforce. Workers are looking for better jobs that have an easier work-life balance and many are making more money as a result. However, those gains are being erased by inflation, which is extreme – but hopefully temporary.
The Biden Administration has been concerned about the increase in prices. There have been many issues with the supply chain — the New York Times mentioned used cars and couches as an example of products that increased in price and were hard to find. The pandemic changed lifestyles, which increased the demand for products like these, but factories weren’t able to keep up with the surge because getting parts was a challenge paired with necessary shutdowns to slow the spread of the coronavirus.
That was all somewhat expected, but that was supposed to be temporary issues and that’s not what happened. “Instead, they have lasted for months, as demand for goods remains strong and the virus continues to disrupt manufacturing and transportation,” New York Times explained.
So, what’s next? Inflation needs to be addressed. Unfortunately, there’s no easy or fast fix. Changes made now can slowly help ensure inflation rates don’t climb to detrimental levels, but it’s multi-stepped and time-consuming.