Inflation In IL: How Much More Is Food, Gas Costing Residents?

ILLINOIS — The economy is doing well, maybe too well.

Nearly six million jobs have been created since President Joe Biden took office earlier this year, a record for a president's first term, and the unemployment rate has fallen to 4.2 percent nationally. And, while businesses added 210,000 jobs in November — fewer than half the number projected by economists — first-time jobless claims fell to a 52-year low, and hourly wages rose at the fastest rate in two decades as businesses competed for workers.

But prices are rising quicker than wages, leading to sticker shock across Illinois, which still has one of the highest unemployment rates in the country at 6 percent — down from a pandemic high of 16.5 percent.

Amid the pandemic, supply chains slowed to a crawl after businesses postponed investments and held off restocking consumer goods to cut costs in case of a prolonged recession. That didn't happen, and businesses were left wrong-footed this year as they scrambled to keep up with unprecedented consumer demand.

High demand and limited supply have caused prices to spike in nearly every sector of the economy over the last 12 months. And consumers flush with savings — from stimulus checks and no place to spend them — have largely accepted the price increases, leading businesses to pass more and more of the costs of reopening on to consumers, economists say.

RELATED: Why Is U.S. Inflation So High, And When Will It Ease? Explainer

On Friday, the U.S. Bureau of Labor Statistics released its monthly consumer price index, a report showing how the price of a basket of goods has changed over time.

According to the report, prices in the Chicago area rose 0.2 percent over the past month, up 6 percent from a year ago. Food prices at the grocery store increased 0.8 percent from October and 6.9 percent since last year. Restaurant prices are up 5.8 percent over the last year, according to the report.

Meanwhile, energy costs increased a full 1 percent month-over-month and a whopping 39.1 percent year-over-year.

Nationally, the consumer price index has soared 6.8 percent in the last year — the biggest 12-month jump since 1982.

Here's a sample of the sticker shock Illinoisans are facing. Cereal prices are up 0.8 percent over the past year. Gasoline has surged 65.1 percent. Home furnishings cost 10 percent more than a year ago. And used cars are up 31.4 percent.

But there's some good news hidden in the report too. While most goods are up significantly from a year ago, many are down from last month, meaning inflation could be slowing. Milk prices, for example, have fallen 1.8 percent in Illinois from October. Clothing costs have fallen 3.3 percent from last month.

And — beyond the timeframe covered by the CPI report — average gas prices have fallen to a seven-week low of $3.35 a gallon, according to AAA. The Energy Information Administration expects them to continue to fall in the coming months, which could rob the CPI — which economists sometimes call the consumer pain index — of some of its bite.

Yet, despite those glimmers of hope, Federal Reserve Chair Jerome Powell has walked back promises that inflation will be "transitory."

Fed officials have scrambled to address inflation concerns with plans to taper the bond-buying program that propped up the financial system during the pandemic, at times roiling the stock market.

But while economists now say they don't know exactly how long the higher prices will last, most believe they will eventually return to something close to normal.

How much have your bills increased over the past year? Let us know in the comments.