High inflation might strain holiday budgets

Nov 10, 2021, 12:47 PM
Zion's Bank Senior Economist Robert Spendlove gives national and local economic update at The Hive ...
Zion's Bank Senior Economist Robert Spendlove gives national and local economic update at The Hive Market in Salt Lake City, Utah on Nov. 10, 2021 (Nick Wyatt, KSL Newsradio)
(Nick Wyatt, KSL Newsradio)

SALT LAKE CITY — Inflation, supply chain problems, and a labor shortage might make for a complicated holiday shopping season this year. 

Holiday budgets on par for previous years

Americans plan to spend an average of $1,000 this holiday season on gifts and other things, according to the National Retail Federation

The NRF says this projection is about equal to what people spent last year, but less than the pre-pandemic holiday season of 2019. 

“The struggle, though, is that holiday budgets won’t stretch as far this year,” said Robert Spendlove, Zion’s Bank Senior Economist. 

Shoppers will get less for their money than in years past as a result of ongoing supply chain problems, labor shortages, and inflation

Highest inflation in decades

The October Consumer Price Index produced by the U.S. Department of Labor shows inflation rose 6.2% last month. That is the highest jump in three decades. Inflation jumped 1% between September and October alone.

The report shows gas prices increased by 49.6% over the last year, costs of used cars and trucks increased 26.4% percent, and meat prices are up by over 20%. 

Unfortunately, the regional numbers are even higher. 

“In our region where Utah is, we saw inflation go up 7%,” Spendlove explained. “Meanwhile, we’re also seeing that producer prices…have jumped 8.6% over the last year.” 

The economist noted the increases on the production side might mean the inflation bump is here to stay. 

“I expect that these kinds of price pressures and the inflation that we’re seeing now…will continue into 2022, maybe mid-22,” said Spendlove. 

As has been the case for several months now, Spendlove said high consumer demand and low supply are driving the price increases. 

Utah economy soaring

Despite these worrying numbers, there is a clear silver lining: Utah’s economy is booming, Spendlove added.

“Utah has the strongest economy in the country. Idaho is right with Utah,” he said. 

The soaring economy might explain why consumer confidence in the Beehives State is currently higher than the national average. 

Another possible upside to the global and national turmoil is the potential boost to local businesses. 

Spendlove also highlighted that the number of jobs in Utah since the start of the pandemic is higher than the national average. 

We want to hear from you.

Have a story idea or tip? Send it to the KSL NewsRadio team here.

Today’s Top Stories

Business + Economy

File**People walk past the entrance to a Bed Bath & Beyond retail store along Sixth Avenue in N...
Paul R. La Monica and Nathaniel Meyersohn, CNN

Bed Bath & Beyond says it can no longer pay its debts

The end could be near for struggling retailer Bed Bath & Beyond, as it warned in a regulatory filing Thursday that it received a notice of default from its lender, JPMorgan Chase.
2 days ago
With 24 other states on board, the Utah Attorney General announced on Friday a lawsuit against a De...
Simone Seikaly

Utah leading a lawsuit against new ESG rule affecting 401(k) plans

Utah Attorney General Sean Reyes said the states in the lawsuit are concerned about the federal government's promotion of ESG investing.
2 days ago
savings system right on the money...
Mark Jones

Economists are worried of a recession in 2023, financial expert weighs in

Many economists are fearing a recession in 2023 despite the U.S. economy ending last year better than expected.
3 days ago
A new service called Cottonwood Connect could address parking problems at the ski resorts in Big an...
Kate Davis and Simone Seikaly

Cottonwood Connect offers a new way to get up Cottonwood Canyons

The goal is to fill gaps left when UTA limited ski bus service. The shuttle will run Thursday through Sunday through mid-April.
3 days ago
The U.S. economy expanded at a 2.9% annual pace from October through December, ending 2022 with mom...
PAUL WISEMAN AP Economics Writer

US economy slowed but still grew at 2.9% rate last quarter

Most economists think the economy will slow further in the current quarter and slide into at least a mild recession by midyear.
3 days ago
About 87% of Tuesday's US flight cancellations are Southwest, according to flight tracking website ...
Pete Muntean and Greg Wallace, CNN

US Transportation Dept. investigating Southwest holiday travel meltdown

The US Transportation Department said it is in the early stages of an investigation into the Southwest Airlines holiday travel meltdown in December.
3 days ago

Sponsored Articles

Banner with Cervical Cancer Awareness Realistic Ribbon...
Intermountain Health

Five Common Causes of Cervical Cancer – and What You Can Do to Lower Your Risk

January is National Cervical Cancer Awareness month and cancer experts at Intermountain Health are working to educate women about cervical cancer, the tests that can warn women about potential cancer, and the importance of vaccination.
Kid holding a cisco fish at winterfest...
Bear Lake Convention and Visitors Bureau

Get Ready for Fun at the 2023 Bear Lake Monster Winterfest

The Bear Lake Monster Winterfest is an annual weekend event jam-packed full of fun activities the whole family can enjoy. This year the event will be held from January 27-29 at the Utah Bear Lake State Park Marina and Sunrise Resort and Event Center in Garden City, Utah. 
happy friends with sparklers at christmas dinner...

15 Easy Christmas Dinner Ideas

We’ve scoured the web for you and narrowed down a few of our favorite Christmas dinner ideas to make your planning easy. Choose from the dishes we’ve highlighted to plan your meal or start brainstorming your own meal plan a couple of weeks before to make sure you have time to shop and prepare.
Spicy Homemade Loaded Taters Tots...

5 Game Day Snacks for the Whole Family (with recipes!)

Try these game day snacks to make watching football at home with your family feel like a special occasion. 
Happy joyful smiling casual satisfied woman learning and communicates in sign language online using...

The Best Tools for Deaf and Hard-of-Hearing Workplace Success

Here are some of the best resources to make your workplace work better for Deaf and hard-of-hearing employees.
Team supporters celebrating at a tailgate party...

8 Delicious Tailgate Foods That Require Zero Prep Work

In a hurry? These 8 tailgate foods take zero prep work, so you can fuel up and get back to what matters most: getting hyped for your favorite
High inflation might strain holiday budgets