Inflation has been weighing on US households for two years, and everyone is feeling it to some degree. But some cities have been hit harder than others, according to a recent analysis by WalletHub.
WalletHub compared the changes in the Consumer price indexa statistic from the Bureau of Labor Statistics that measures the cost of a mix of goods like groceries, gas, and services, in 23 metropolitan areas.
The analysis found things were worse in Anchorage, Alaska — and by a lot. Over the past year, the CPI has jumped more than 12%, WalletHub found.
No region seems to be spared by the ranking. Cities in the West, South, Midwest and East Coast were all in the top 10. (See the full ranking below.)
You might think inflation is hitting expensive states hardest, but it’s not, think tank says Economic Innovation Group. Prices in lower-cost states rose the most, the group found. For example, Hawaii – where the cost of living has long been high – appears to have one of the smallest impacts on inflation.
“Many of today’s inflation hotspots were actually becoming more affordable relative to the country until the Covid-19 pandemic hit. This model could give those living in those states a sense of boost,” said the Economic Innovation Group.
What explains the difference? Many historically cheap states “are home to industries disproportionately affected by price increases, such as manufacturing,” the group explains. “Some are rural, where gasoline and other staples feature prominently in the household and business spending basket. Some states have also seen rapid population growth drive up housing costs, particularly in the Mountain West region.
High-cost states like Hawaii, California, and New York have economies that are more reliant on the service sector, have taken longer to recover from COVID-related economic shutdowns, and haven’t seen the boom return to business (and the resulting inflation) as a result.
See below for more on how the 23 cities compare when it comes to inflation:
|subway station||Score||CPI change (last 2 months)||Change in CPI (last year)|
|3||Atlanta-Sandy Springs-Roswell, Georgia||56.22||2.40%||11.50%|
|6||Miami-Fort Lauderdale-West Palm Beach, Florida||49.36||2.50%||10.60%|
|seven||Houston-The Woodlands-Sugar Land, Texas||48.28||2.80%||10.20%|
|9||Tampa-St. Petersburg-Clearwater, Florida||45.22||1.30%||11.20%|
|11||St. Louis, Missouri||29.95||2.40%||8.40%|
|12||Dallas-Fort Worth-Arlington, TX||27.65||1.00%||9.40%|
|13||Riverside-San Bernardino-Ontario, California||26.73||1.10%||9.20%|
|16||Minneapolis-St. Paul-Bloomington, Minnesota||19.02||1.20%||8.20%|
|17||Los Angeles-Long Beach-Anaheim, CA||12:48||0.90%||7.70%|
|18||Washington-Arlington-Alexandria, DC-Va.-Md.-WV||12:32 p.m.||1.10%||7.50%|
|19||San Diego-Carlsbad, California||11:40 a.m.||1.20%||7.30%|
|20||San Francisco-Oakland-Hayward, California||11.00||1.70%||6.80%|
|22||New York-Newark-Jersey City, NY-NJ-Pa.||3.85||1.10%||6.50%|
|23||Urban Honolulu, Hawaii||2.54||0.60%||6.80%|
There are early signs this week that inflation may finally be slowing down. A report from the Labor Department on Thursday showed that the producer price index – which measures inflation before it reaches consumers – fell 0.5% in July. It was the first monthly decline since April 2020 and was down from a strong 1% increase from May to June.
The easing of wholesale inflation suggests that consumers may get some relief from relentless inflation in the months ahead. The wholesale report follows government data on Wednesday which showed that consumer inflation remained unchanged from June to July — the first flat figure after 25 consecutive months of increases.
Still, economists warn that it’s still too early to say that inflation is steadily heading down.
“July’s deceleration … is a step in the right direction,” said Rubeela Farooqi, chief U.S. economist at High Frequency Economics. “But production costs continue to rise at a rapid rate, well above target.”
The Associated Press contributed to this report.
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