In July 2021, the United States Department of Labor reported that the Consumer Price Index (CPI) rose 5.4%. The increase in consumer prices was the largest jump since August of 2008, when the housing market collapsed.
This rise has resulted in the price increase of many common goods, such as food and gasoline.
According to the Department of Agriculture (DOA), food prices have seen the largest increase due to rising inflation rates. The DOA reports that the price of restaurant purchases has increased on average 4.6% from last year, and food prices at the grocery store have increased 2.6% from last year. The Bureau of Labor Statistics reports that bacon, coffee, eggs, whole milk and produce have seen the largest price increase in the national average.
Gasoline prices have also been affected by inflation. David Blackman, a financial reporter for Forbes magazine reports that the national price of gasoline has risen nearly one dollar per gallon from one year ago. The United States Energy Information Administration suspects that gasoline prices will continue to climb throughout the winter of 2021.
Economic researchers believe that the rise in current prices can be attributed to the reopening of businesses without enough staff on hand. Glenn Kessler, an economics analyst for The Washington Post, stated that while America is working to reopen the economy, supply is low but general demand for these products is high.
Kessler also stated that due to labor shortages, employers are paying new and current employees more, and businesses typically pass that expense onto customers through price raising.
James Smith, a Florida State University senior majoring in Business Administration with a concentration in real estate finance also added his insight on the current inflation rates. Smith explained why inflation is rising and how it has affected himself and his business.
“The cost of labor and materials has increased,” Smith said. “Property owners like myself need to look very hard to find good labor. It is a miracle to find someone working for less than 15 dollars an hour.”
Smith also shared how students can combat inflation while in college, and how tips like saving and ensuring that your credit score is in good standing can carry your financial future a long way.
“The best way for an individual to combat inflation is to own assets,” Smith said. “I will use houses as an example again. If inflation rises, then the value of the home and the rent the owner can charge will rise as well…Students should lay a strong foundation for homeownership. Squaring away your credit, eliminating consumer debt and saving will put you in a great position to own a house when you graduate.”
With prices rising and students at Florida State living on a college budget, saving money can become a goal for many of them. Robert Farrington is a financial adviser with the College Investor, a website that shares tools and resources on investing and personal finance management, specifically for college students. Farrington shared many tips and free resources that can help college students save on groceries and other essentials without taking away from academic time.
“For most college students, this is your first time having to budget and manage money on your own,” Farrington said. “The most important thing is making a concrete plan for your tuition and personal spending money.”