It’s not just the price of food and fuel. Inflation is affecting almost everything

Minneapolis ( Business) — Inflation has reached almost every corner of American life.

In Queens, New York, auto repair shop owner Audra Fordin says some customers have chosen to save money by patching their flat tire, only to face more expensive repairs later.

In Mount Juliet, Tennessee, the directors of a nonprofit dog sanctuary have seen pet food and veterinary care costs skyrocket while donations have dwindled.

In New Orleans, a fledgling art and card business has had to play guessing games with suppliers, rarely knowing when the goods will arrive or how much they will cost because of extra fuel charges.

In St. Paul, Minnesota, the owners of a sporting goods store have heard from suppliers about price increases that have not yet occurred.

It’s not just food and fuel

From new tires to a visit to the dentist or a new piece of sports clothing, almost every spending category recorded in the Consumer Price Index shows a price increase not only from last year, but also from before the pandemic. The gains, spurred in part by high oil prices, supply chain disruptions and global economic pressures, underscore how pervasive inflation has become in the United States.

“Everything that is directly or indirectly related to or dependent on those very important categories, food and energy, is also seeing faster increases, but it’s really a general increase,” said Nikolai Roussanov, a finance professor at the Wharton School. from the University of Pennsylvania.

In June, prices for major appliances were up nearly 24% from before the June 2019 pandemic, tires were up 20%, veterinary services were up 17%, and sporting goods were up nearly 14%, according to the CPI.

Although those increases may not seem relevant compared to gas and grocery costs that are significantly higher than they were in 2019, a 20% increase in a one-time, and frequently urgent, expense can wipe out the budget of a person at a time when paychecks have to be made to last.

“Low-income families are easily derailed by these unexpected expenses,” said Elizabeth Ananat, a Barnard College economics professor who studies issues such as inequality, poverty and the effects of the pandemic on low-income mothers and families.

And while pandemic-related stimulus efforts, such as expanded child tax credit payments, temporarily eased some of these families’ money concerns by helping them manage unexpected expenses and maintain employment, low-income families income has exhausted that savings cushion, he said.

“When we look at the bank balances of low-income families, they are back down to zero, on average,” he said. “When that happens, people don’t make ends meet… and the snowball starts to grow.”

Businesses are seeing firsthand how rising costs are spreading into all facets of life and the difficult choices consumers are making as a result.

Decrease in repairs

At Great Bear Auto Repair in the New York borough of Queens, “everything is going up” in price, said Fordin, whose great-grandfather opened the business in 1933.

“My motor oil is through the roof,” he said. “Every time they deliver, every week, motor oil prices are going up, my auto parts prices are going up, my labor is going up, my cost of living is going up.”

For the most part, Great Bear is having to eat a lot of price increases, especially when it comes to services like oil changes, he said.

“We are doing it at cost to be able to continue providing the service,” he said. “People don’t necessarily have the finances right now for an even bigger raise.”

Audra Fordin of Great Bear Auto Repair in Queens, New York, says customers are cutting back on repairs to save money.

Widespread inflation deals a double whammy for the auto business, which has been in a state of flux due to high oil prices, shipping delays and chip shortages. Many customers put even more miles in their cars because they can’t afford a new or used one and have started cutting back on repairs, even relatively minor ones.

It’s about a shift in consumer behavior and sentiment that Fordin last saw around 2008, when oil prices were skyrocketing and the Great Recession was in full swing.

“It feels like indecision; people are scared,” he said. “They’re uncomfortable with money. They can’t afford to put gas in their car. They can’t afford to put oil in their car.”

double whammy

At Old Friends Senior Dog Sanctuary in Tennessee, donations serve as a lifeline.

This 10-year-old nonprofit organization provides food and veterinary care to more than 500 senior dogs, including 125 rescues and about 400 furry friends placed in foster homes. Operating costs are about $4 million a year, and the organization is 100% dependent on donations.

Old Friends Senior Dog Sanctuary in Tennessee pays more for the food and veterinary care it provides for more than 500 dogs.

Donations have dropped considerably since the end of last year, down 50%, says Zina Goodin, the sanctuary’s executive director.

“Everyone is being affected. [por el aumento de los precios]”, it states.

Old Friends has a financial cushion that is filling the gap, but operating costs have been rising, he said. Food costs are 25% higher than last year, drug costs are rising and labor costs are rising as the nonprofit tries to be competitive for workers, he said. she.

“Right now we’re fine, but as time goes by, that mattress will eat away,” he said, “and we’re worried about what’s going to happen.”

quieter streets

New Orleans’ Magazine Street is home to cafes, restaurants and boutiques, including The Collective Shop, an art prints 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 is now trying to navigate this period of high inflation, Fields said. Cardstock and other paper goods have become more expensive, as well as more difficult to come by. Supply has been tight, causing Fields and Point to second-guess inventory needs and buy more than they normally would.

The Collective, a New Orleans stationery and fine art printing company, survived the pandemic. Now he faces rising supply costs and extra fuel charges.

“We have to play this fun game of overstocking certain things, thinking we’re going to need them later,” Fields said.

Rising costs have forced the fledgling company to discontinue its free online shipping as supply costs and shipping charges have become too unpredictable.

For the most part, The Collective Shop has tried not to raise the price of its cards and paper goods, letting the wall art serve to make money, he said.

But for a store that is part of a shopping district that relies heavily on passers-by and tourists, Fields has noted that inflation appears to be taking its toll.

“We are used to being full of travelers and it is no longer the same,” he says. “It shows that there are still many doubts when it comes to traveling and buying anything that is not food and liquor.”

upcoming costs

Inflation levels are expected to moderate in the coming months, but consumers are likely to feel the effects of high prices for many months.

At Joe’s Sporting Goods in St. Paul, Minnesota, most of the outdoor gear on display — a colorful array of kayaks, tents, paddle boards and other products — were made more than six months ago and at a time when the oil used to make those items was considerably cheaper, said Jim Rauscher, co-owner and president of the Twin Cities company.

The Russian invasion of Ukraine earlier this year helped send oil prices soaring to record highs, affecting everything from gas station prices to key oil-based materials, and Rauscher is bracing for price increases.

Prices of petroleum-based products like these kayaks on display at Joe’s Sporting Goods in St. Paul, Minnesota, are expected to soar further due to the Russian invasion of Ukraine.

The kayak that may retail for $850 now will likely cost $1,000 or a little more next year, he said.

“Higher prices will be seen at least through the holidays and possibly into next spring,” he said.

Although everyone in the supply chain is feeling the effects of rising prices, Rauscher tries to keep the situation in perspective. His family has been running Joe’s for nine decades and has navigated many rough economic waters.

“Having been through it in the past and knowing it’s all a bit cyclical, we’ll get through it,” he said of his business.

Do what you can

As widespread inflation continues to put certain purchases out of reach, families are learning to adjust their budgets…and their outlook.

When Amy Randall’s dishwasher broke a couple of months ago, the substitute teacher watched video after video on YouTube for possible solutions, but none of them worked. She now washes the dishes by hand.

When the cost of a cut of steak hit $28 due to inflation, Randall’s family turned to their garden full of zucchini.

Her house in the Catskills of New York could use a fresh coat of paint, but the prices being quoted are now completely out of reach for the 60-year-old single mother.

“I don’t care anymore that the paint is peeling in my house, I don’t have the money,” he said. “People have to make a living, and people charge more for things. So all these things have to be put aside.”

Randall said she’s taken a more mindful approach, being less impetuous and more resourceful, or just “being okay with things that aren’t okay,” she said.

“I don’t want my children to see the sorrow and the anguish,” she said. “I want my children to see that we are flexible and that we have everything we need, but some things are too expensive.”