Prices rising, products ‘shrinking’ as consumers feel a squeeze

Business

SAN DIEGO – If you’ve taken a walk through the grocery store lately, you’ve likely noticed the number on price tags going up.

“I would say groceries feel a little higher,” Cathy Newcomb, a San Diego resident, told FOX 5 Friday.

”Yeah, prices are creeping up and it’s easily noticeable,” agreed Jake Holmes of Kearny Mesa.

Based on data from the U.S. Bureau of Labor Statistics, food has seen some of the greatest increases, with products like pork topping more than an 8% hike compared to 2020.

Alan Gin, an economist from University of San Diego, notes that common goods are up 5.5% on average. And in addition to simply increasing prices, he says some companies are decreasing the size of their products. “Shrinkenomics,” Gin called it.

He said an increase in oil prices is really driving inflation right now, but also notes that most Americans are prepared to handle the increase.

“People have money,” he said. “They didn’t spend it and maybe built up what they call a ‘COVID piggy bank.’”

But with products up 5.5% across the board, there’s concern about just how long consumers can absorb the hikes. Gin sounded optimistic Friday that the market would smooth itself out.

“You have the entire economy coming back at once,” Gin noted. “There’s these bottle necks and once we get back to normal, a lot of these odd problems will resolve themselves.”

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