ALBANY, N.Y. (NEWS10) – In the latter half of 2021, economic experts expressed concern that the United States could be entering an inflationary period. Supply changes from the COVID-19 pandemic created cost increases in many consumer spending categories, to include housing, food and beverage, transportation and energy.
Federal stimulus measures have introduced more money into the economy, and wages are hiking up at the lower end of the wage scale in order to retain employees in area workplaces. These factors have contributed to conditions where the amount of money available in the economy is exceeding the availability of goods on which to spend.
The result in recent months has been successive months of higher-than-usual increases in consumer prices, as measured year-over-year from 2020 to 2021:
- 5.4% in September
- 6.2% in October
- 6.9% in November
The U.S. Federal reserve called this period a “transitory” one earlier in 2021- but experts have now shifted away from that belief, coming to the consensus that this period of inflation is likely to have a long-lasting effect on prices. Financial experts say this will raise Americans’ cost of living in 2022.
The recent inflationary period also looks different from recent years in terms of the spending categories that have been driving inflation overall. From 2010 to 2020, housing and food and beverage saw the greatest increases in cost, with increases of 25.7% and 21.2%, respectively, while transportation had a much lower 4.1% increase and energy saw a decrease of 6.8% over the same period. But in recent months, transportation and energy have seen some of the fastest increases.
A new report from Filterbuy illustrating the recent inflationary period found that Albany residents saw an increase of 16.6% in the cost of living between 2010 and 2020. Out of all midsized metropolitan areas in the nation, Albany saw the 17th largest cost of living increase in the last decade. Here is a summary of the data for the Albany-Schenectady-Troy area:
- Percentage change in cost of living (2010–2020): +16.6%
- Overall cost of living (compared to average): +0.3%
- Cost of goods (compared to average): -1.3%
- Cost of housing (compared to average): +5.7%
- Cost of utilities (compared to average): -4.1%
For reference, here are the statistics for the entire United States:
- Percentage change in cost of living (2010–2020): +16.2%
- Overall cost of living (compared to average): N/A
- Cost of goods (compared to average): N/A
- Cost of housing (compared to average): N/A
- Cost of utilities (compared to average): N/A
The data used in this analysis is from the most recent U.S. Bureau of Economic Analysis Regional Price Parities Dataset (RPP), released in December 2021. To determine the locations with the largest increases in living cost over the past decade, researchers at Filterbuy calculated the percentage change in RPP between 2010 and 2020, adjusted for the U.S. Personal Consumption Expenditures Price Index over the same time period. In the event of a tie, the location with the higher RPP in 2020 was ranked higher.
Regional price parities measure the differences in price across locations relative to the national average. They are calculated annually using a wide range of items from the Consumer Price Index as well as housing data from the American Community Survey.