The Pennsylvania Chamber of Business and Industry said the country’s high inflation rate is impacting large and small businesses in its state.
November’s inflation rate of 6.8 percent, the highest since 1982, was announced on Friday. The U.S. Labor Department also reported on Friday that prices rose in October and November.
“Our economy is already overwhelmed with supply-chain issues, a workforce shortage, and an increase in consumer demand, particularly during the holiday season,” Chamber President Gene Barr said. “A high inflation rate hampers economic recovery and can be particularly painful on small businesses as they are less able to withstand challenges to their financial goals. As products and services get more expensive, there is no doubt that consumption will continue to fall.”
According to Trading Economics, the rise in November’s inflation rate marks the 9th consecutive month that inflation had stayed above the Fed’s 2 percent target. A rally in global commodities, rising demand, wage pressures, supply chain disruptions and a low base effect from last year are pushing prices up, the economic information web site said. Energy costs saw the biggest gain, the site said, increasing from 30 percent in October to 33.3 percent in November — primarily in gasoline. Other areas seeing increases included shelter, food, new vehicles, used cars and trucks, apparel and medical care services.
The chamber recommended that Congress should stop consideration of the Build Back Better budget reconciliation bill.
“As inflation continues to soar, it is time for Congress to halt action on the proposed tax and spend reconciliation bill,” Barr added. “Adding another $150 billion in transfer payments and tax cuts, plus additional spending will be a recipe for disaster for more inflation over the next year. We must continue to prioritize rebuilding our economy, and this bill is a roadblock to long-term economic recovery.”