Metro Atlanta Has Highest Consumer Price Index Over 1 Year Due To Inflation

ATLANTA, GA — No large metro saw more of an increase in consumer prices in the past 12 months because of inflation than Atlanta.

According to the latest consumer price index report released by the U.S. Bureau of Labor Statistics, the Atlanta-Sandy Springs-Roswell area had the highest inflation rate — 9.8 percent between December 2020 and the end of last year — among metropolitan areas with a population of over 2.5 million.

That’s ahead of Phoenix (9.7), St. Louis (8.3), Tampa (8.0), and Baltimore (8.0). Conversely, areas like New York City and San Francisco, which are traditionally among the most expensive cities, showed the lowest inflation among the 23 large population areas identified for the same time period – respectively only 4.4 percent and 4.2 percent.

Inflation had a larger impact on large metropolitan areas last year than on communities with less density.

In a report released Monday, The Wall Street Journal aligned the growth with COVID-19 pandemic-related migration and resulting population shifts caused by remote workers and baby boomers looking to relocate to warmer climes with cheaper costs of living.

The latest national consumer price index data released last week showed a rise in costs of 7.5 percent over 12 months ending in January. National numbers showed food prices went up 7 percent, and energy increased by 27 percent, with gasoline prices reflecting a 40-percent spike.

In the Metro Atlanta area, the food index increase 2.6 percent from December 2020 to the same time in 2021, while the energy index rose 28.6 percent, led by a spike of 55.7 percent for gasoline.

The index for non-food or energy rose 9.3 percent year over year with shelter seeing a 7.7-percent jump.

The price spikes were seen across sectors, not just for items directly affected by the pandemic. New car prices, which jumped during the pandemic because of a shortage of computer chips, were unchanged month to month but were up 12.2 percent over a year ago. The surge in new car prices accelerated prices for used cars: They rose 1.5 percent in January over December and were up a dizzying 41 percent over a year ago.

"Just as price pressures in some areas ease, inflation in other parts of the economy" picked up, said Sarah House, an economist at Wells Fargo. "The upshot is that inflation is likely to remain uncomfortably high."

The steady rise in prices left many Americans less able to afford food, gas, rent, child care and other necessities. More broadly, inflation emerged as the biggest risk factor for the economy and a serious threat to President Joe Biden and congressional Democrats as midterm elections loom later this year.

In the past year, sharp increases in the costs of gas, food, autos and furniture upended many other Americans' budgets. In December, economists at the University of Pennsylvania's Wharton School estimated that the average household had to spend $3,500 more than in 2020 to buy an identical basket of goods and services.

Many large corporations, in conference calls with investors, said they expected supply shortages to persist until at least the second half of the year. Companies from Chipotle to Levi Strauss & Co. also warned that they will likely raise prices again this year after having done so in 2021.

Chipotle said it increased menu prices 10 percent to offset the rising costs of beef and transportation as well as higher employee wages. And the restaurant chain said it will consider further price increases if inflation keeps rising.

"We keep thinking that beef is going to level up and then go down, and it just hasn't happened yet," said John Hartung, the company's chief financial officer.

Executives at Starbucks and other consumer-facing companies said their customers so far don't seem fazed by the higher prices.

Levi Strauss & Co. raised prices last year by roughly 7 percent above 2019 levels because of rising costs, including labor. It plans to do so again this year. Even so, the San Francisco-based company upgraded its sales forecasts for 2022.

"Right now, every signal we're seeing is positive," CEO Chip Bergh told analysts.

The Associated Press and Patch Editor Paige Austin contributed to this report.