It’s not just food and fuel: inflation impacts the cost of almost everything
In Queens, New York, auto repair shop owner Audra Fordin says some customers chose to save money by correcting a flat tire to be swept away by more expensive repairs later.
In Mount Juliet, Tennessee, operators of a nonprofit dog sanctuary have seen costs for pet food and veterinary care soar while donations have tapered off.
In New Orleans, a young art and card company had to play a guessing game with suppliers, rarely knowing when products might arrive or how much they would cost due to fuel surcharges.
In St. Paul, Minnesota, owners of a sporting goods store heard from salespeople about price increases that haven’t come down yet.
It’s not just food and fuel
“Anything that touches or depends directly or indirectly on these really hot categories – food and energy – also sees faster increases, but it’s really a generalized increase,” said Nikolai Roussanov, professor of finance at the Wharton School. from the University of Pennsylvania.
In June, prices for major household appliances rose nearly 24% because before the pandemic in June 2019, tires had increased by 20%, veterinary services by 17%, sporting goods by around 14%, according to the CPI.
While these increases may pale in comparison to gas and grocery costs that are significantly higher than in 2019, a 20% hike on a one-time — and often urgent — expense can be a budget killer. at a time when paychecks are scattered.
“Low-income families are easily confused by these unexpected expenses,” said Elizabeth Ananat, an economics professor at Barnard College who studies topics such as inequality, poverty and the effects of the pandemic on mothers and children. low income families.
And while pandemic-related stimulus efforts, like expanding child tax credit payments, have temporarily eased some of those lingering financial concerns for families by helping them manage unexpected expenses and maintain employment, low-income families have depleted that reserve of savings, she said.
“When we look at the bank balances of low-income families, it went back down to zero, on average,” she said. “When that happens, people can’t make ends meet…and it starts to snowball.”
Companies see how higher costs affect all facets of life and the tough choices consumers make as a result.
At Great Bear Auto Repair in New York’s Queens borough, “everything goes up” in price, said Fordin, whose great-grandfather started the business in 1933.
“My motor oil is off,” she said. “Every time they deliver, every week, my motor oil prices go up, my auto parts prices go up, my labor goes up, my cost of living goes up.”
For the most part, Great Bear has to absorb a lot of the price increases, especially when it comes to services like oil changes, she said.
“We just do it at cost so we can still provide the service,” she said. “People don’t necessarily have the finances right now for even more of a raise.”
“It’s like hesitation, people are scared,” she said. “They’re not comfortable with money. You can’t afford to put gas in your car. You can’t afford to put oil in your car.”
At the Old Friends Senior Dog Sanctuary in Tennessee, donations serve as a lifeline.
The 10-year-old nonprofit provides food and veterinary care to more than 500 senior dogs, including 125 rescues and about 400 furry friends placed in “Forever Foster” homes. Operating costs are approximately $4 million per year and the organization is 100% dependent on donations.
Those donations have dropped significantly since late last year, dropping 50%, said Zina Goodin, the shrine’s executive director.
“Everyone is hit [by rising prices],” she says.
Old Friends has a financial buffer that fills the gaps, but those operational costs have increased, she said. The cost of food is about 25% higher than last year, drug costs are rising and labor costs are rising as the nonprofit tries to stay competitive for workers, she said.
“We’re fine at the moment, but over time that buffer will be consumed,” she said, “and we worry about what’s going to happen.”
Magazine Street in New Orleans is home to cafes, restaurants and shops, including The Collective Shop, an art printing and stationery business launched in 2020 by Alysia Fields and Toni Point.
After successfully surviving the worst of the pandemic, the store and online retailer are now trying to weather this period of high inflation, Fields said. Card stock and other paper goods have become more expensive and harder to find. The supply was shoddy, leaving Fields and Point guessing at stock needs and buying more than they usually would.
“We have to play this fun game of overstocking certain things, thinking we’ll need them later,” Fields said.
Cost increases forced the start-up company to suspend its online free shipping, as sourcing costs and shipping surcharges became too unpredictable.
For the most part, The Collective Shop tried not to raise the price of its cards and paper goods, instead letting wall art serve as a source of income, she said.
But for a store that’s part of a business district heavily reliant on passers-by and tourists, Fields has noticed inflation seems to be taking a bite out.
“We’re so used to crawling with travelers, and it’s just not the same,” she said. “You can tell there’s still a lot of hesitation to travel and buy anything outside of food and alcohol.”
Inflation levels are expected to moderate in the coming months, but consumers will likely feel the effects of high prices for many months to come.
The kayak that might cost $850 now will likely cost $1,000 or a little more next year, he said.
“You’re going to see higher prices at least over the holidays and maybe into next spring,” he said.
As everyone along the supply chain feels the effects of rising prices, Rauscher is trying to keep the situation in perspective. His family has run Joe’s for nine decades and has navigated many choppy economic waters.
“Having been through this in the past and knowing that everything is sort of cyclical, you’ll get through it,” he said of his business.
As widespread inflation continues to put some purchases out of reach, families are learning to adjust their budget and outlook.
When Amy Randall’s dishwasher broke a few months ago, the substitute teacher watched video after video on YouTube to discover potential fixes, but none of them worked. She washes the dishes by hand now.
When the cost of the chuck roast hit $28, Randall’s family turned to their garden full of zucchini instead.
Her home in New York’s Catskills area could use a fresh coat of paint, but the listed prices are now completely irrelevant to the 60-year-old single mother.
“I don’t care about the paint peeling on my house anymore, I don’t have the money,” she said. “People have to make a living, and people charge more. And so all of those things have to be put aside.”
Randall said she’s taken a more conscious approach, being less brash and more resourceful, or just “being OK with things that are wrong,” she said.
“I don’t want my children to see the grief and the distress,” she said. “I want my children to see that we are flexible and have everything we need, but some things are just too expensive.”