Inflation Cools, But With Wages on the Rise, Employers Remain Wary
Emsi Burning Glass Report “Why Inflation Isn’t Going Away” details how the talent-shortage and resulting wage spikes will keep prices high
MOSCOW, Idaho - September 14, 2021 - The Consumer Price Index for All Urban Consumers (CPI-U) increased 0.3 percent in the month of August, per the Bureau of Labor Statistics. This pushed the index to 5.3%.
Despite cooling inflation, wages are continuing to rise, meaning that prices will remain high and will be difficult to walk back.
Why Inflation Isn’t Going Away
A recent Emsi Burning Glass inflation report, Why Inflation Isn’t Going Away, explains that this is what happens when income and spending go up, driving up orders for goods, that can’t be matched by the supply available.
Why the discrepancy between supply and demand? One of the biggest reasons is that there simply aren’t enough people to generate products. Since the beginning of 2020, manufacturing job postings have increased by over 100%, hitting more than 800,000 as of May 2021.
This surge in postings indicates that manufacturers are desperate to hire. Yet countless manufacturing employers can’t find labor.
“Businesses are being forced to pay ever-climbing salaries to attract talent and remain competitive.” Ron Hetrick, senior labor economist at Emsi Burning Glass and author of the report, said. “These increases are becoming embedded in product pricing and manifest in additional consumer spending. As long as the demand for people outpaces the supply, prices will stay high.”
Read the full report by Ron Hetrick, senior labor economist at Emsi Burning Glass, here.
About Emsi Burning Glass
Emsi Burning Glass is the world’s leading authority on job skills, workforce talent, and labor market dynamics, providing expertise that empowers businesses, education providers, and governments to find the skills and talent they need and enables workers to unlock new career opportunities.
Headquartered in Boston, Massachusetts, and Moscow, Idaho, Emsi Burning Glass is active in more than 30 countries and has offices in the United Kingdom, Italy, New Zealand, and India. The company is backed by global private equity leader KKR.