Wed, Jan 12, 2022 10:31 AM
By Casey Harper | The Center Square, The Center Square
(The Center Square) – Inflation spiked at its fastest rate in nearly 40 years in 2021, newly released federal data for December show.
The Department of Labor’s Bureau of Labor Statistics released new inflation figures Wednesday showing the price of goods and services have soared at the fastest rate since 1982.
“The all items index rose 7.0 percent for the 12 months ending December, the largest 12-month increase since the period ending June 1982," BLS said. "The all items less food and energy index rose 5.5 percent, the largest 12-month change since the period ending February 1991. The energy index rose 29.3 percent over the last year, and the food index increased 6.3 percent.”
The year-long increase continued with a 0.6% increase in the consumer price index in December, meaning everyday purchases are becoming increasingly more expensive for Americans.
“This was the sixth time in the last 9 months it has increased at least 0.5 percent,” BLS said. “Along with the indexes for shelter and for used cars and trucks, the indexes for household furnishings and operations, apparel, new vehicles, and medical care all increased in December. As in November, the indexes for motor vehicle insurance and recreation were among the few to decline over the month.”
The National Federation of Independent Businesses released a report this week showing that this spike in inflation is among small businesses top concerns.
The report found that 22% of small business owners say inflation is the biggest problem for operating their business, a 20% increase from the beginning of 2021. That level of concern is the highest reported since 1981, according to NFIB.
“Small businesses unfortunately saw a disappointing December jobs report, with staffing issues continuing to impact their ability to be fully productive,” NFIB Chief Economist Bill Dunkelberg said. “Inflation is at the highest level since the 1980s and is having an overwhelming impact on owners’ ability to manage their businesses.”
The new data come after Federal Reserve Chairman Jerome Powell told Congress Tuesday that high inflation is “a severe threat” to the job market.
“As Chairman Powell said yesterday, inflation is a severe threat to getting workers off the sidelines and back into the workforce – yet the Biden Administration has ignored it, denied it, and is now passing the buck for their own incompetence,” House Ways and Means Republican Leader Kevin Brady said.
Meanwhile, the latest producer price index data, another key marker of inflation, has skyrocketed as well. That index rose 0.8% in November alone and has seen a 9.6% increase in the past year, the highest spike since the federal government began tracking the data in 2010.
President Joe Biden has taken fire for months for rising inflation, even as he has pushed for several trillion dollars more in federal spending. Opponents of those spending bills have raised concerns about inflation, since federal debt is offset in part by printing money.
Biden has argued his plan will decrease inflation, though that has been disputed.
“This trend isn’t ‘transitory,’ and it’s all happening under Democrats’ one-party control,” Republican Leader Rep. Kevin McCarthy said.