Year-over-year inflation rate now stands at 6.5%

Year-over-year inflation rate now stands at 6.5%

inflation

Year-over-year inflation rate now stands at 6.5%

Today the U.S. Bureau of Labor Statistics announced that the Consumer Price Index (CPI) dropped 0.1% in December, meaning the year-over-year inflation rate now stands at 6.5%. The Bureau also released the 2022 annual average price level, which was 8% higher than 2021.

The Georgia Center for Opportunity’s (GCO) take: “We keep seeing positive headlines about the inflation rate, but that good news is lost on average Georgians who are continually pinched on the cost for everyday necessities like groceries and gas,” said Erik Randolph, GCO’s director of research. “Although there was some positive news in the December numbers, it’s important to keep in mind that core inflation remained elevated, including for food. If policymakers in Washington truly want to help the most economically vulnerable in our country, they must return to fiscal sanity and rein in the spending. Federal Reserve Chairman Jerome Powell remains steadfastly committed to bringing down inflation, and hopefully the change of political leadership in the U.S. House will mean more responsible federal spending. The policy goal should be to repeat the general decline in prices as what happened in December so the price level slowly comes back down. This will extend the opportunity of a higher standard of living for everyone, the rich and poor alike.”

Erik Statement
Welcome lawmakers to Atlanta for the opening of the 2023 session

Welcome lawmakers to Atlanta for the opening of the 2023 session

In The News

Welcome lawmakers to Atlanta for the opening of the 2023 session

The Georgia Center for Opportunity issued the following media statement welcoming lawmakers to Atlanta for the opening of the 2023 session of the Legislature on Jan. 9.”We’re excited to see what the new session holds for our state, and we stand ready to assist lawmakers in passing an agenda that serves all Georgians,” said Buzz Brockway, executive vice president of public policy for GCO. “GCO has served our state for nearly 25 years, and has dedicated itself to expanding opportunity by helping increase access to quality education, fulfilling work, and healthy family life. We know that by addressing these critical barriers we can help pull communities out of poverty and expand opportunity to every community in our state.”As an organization, GCO stands ready to provide resources and education to lawmakers on the impact policies have on underserved communities and the opportunities available (and not available) to all Georgians. Here are three key area:
Eliminating benefits cliffs
    • Some workers find themselves torn between taking steps toward a more secure future, but ultimately forced into making decisions that traps them into long-term dependence on government benefits. These are known as benefits cliffs. We’ll be working to educate lawmakers on this reality and propose reforms to ensure all workers have the opportunity to climb the economic ladder. Learn more

Expanding educational freedom

    • We are still uncovering the extent of learning loss experienced by kids during the pandemic. We know that expansion of educational opportunityis a key solution to this problem. Passing Education Scholarship Accounts, or ESAs, will be a big step forward in helping all Georgia students achieve their full potential.

Promoting an anti-poverty agenda

    • GCO is part of the Alliance for Opportunity, a three state network of policy organizations built around furthering an anti-poverty agenda. We will be working with lawmakers to promote solutions to poverty that lift Georgians up into the middle class.
Media Statement: Decrease in the CPI is welcomed good news

Media Statement: Decrease in the CPI is welcomed good news

Erik - CPI decrease

Media Statement: Decrease in CPI is welcomed good news, but new policy is not good news for working class and poor

Today the U.S. Bureau of Labor Statistics announced that the Consumer Price Index (CPI) remained even in July, reducing the year-over-year inflation rate to 8.5%. That is a reduction in the rate from June, which was 9.1%.

The Georgia Center for Opportunity’s (GCO) take: “July’s ever-so-slight decrease in the CPI is a sliver of welcome good news in an economic environment where there doesn’t seem to be much good news,” said Erik Randolph, GCO’s director of research. “July’s price level — defined as the weighted average price across the board for goods and services purchased by households — ticked down 0.2% at an annualized rate. But we should pause before getting too enthusiastic about the news. The CPI is still 8.5% higher than 12 months ago, and it is unlikely that the miniscule CPI drop will turn into a sustainable trend. A big reason is federal policy. Congress is about to hike spending yet again with the erroneously named Inflation Reduction Act, and the Federal Reserve acknowledged that its goal is to just bring the inflation rate down to 2%, meaning they will take steps to prevent the price level from coming down from its elevated level. This is horrible policy on both accounts, especially for the working class and the poor, who carry a heavier economic burden with higher prices for what they need to purchase.”

Media Statement: Number of people working hasn’t caught up to pre-pandemic levels

Media Statement: Number of people working hasn’t caught up to pre-pandemic levels

Erik R - statement - July job numbers

Media Statement: Number of people working hasn’t caught up to pre-pandemic levels

On Friday, the U.S. Bureau of Labor Statistics announced that total non-farm payroll employment rose by 528,000 in July. The result was much higher than expected.

The Georgia Center for Opportunity’s (GCO) take: “Friday’s jobs report is being billed as great news, but peeling back a few layers reveals a worse reality,” said Erik Randolph, GCO’s director of research. “It’s true the number of jobs in the United States is now at pre-pandemic levels. The difference is that the number of people who are actually working hasn’t caught back up. That implies more people are working two or even three jobs to make ends meet in this highly inflationary environment. Meanwhile, wage growth isn’t keeping pace with inflation, putting poor and working class Americans even further behind.”

Media Statement: Assessing the GDP numbers and what it means

Media Statement: Assessing the GDP numbers and what it means

In The News

Media Statement: Assessing the GDP numbers and what it means

Today, the U.S. Bureau of Economic Analysis announced that in the second quarter of 2022, real Gross Domestic Product (GDP) declined by 0.9%. That marks two consecutive quarters of negative growth, a barometer of economic health that economists typically use to define a recession.

The Georgia Center for Opportunity’s (GCO) take:
“It’s now official. We’re having stagflation.

There has never been a time when the Business Cycle Dating Committee did not declare a recession when real GDP declined for two consecutive quarters since the availability of quarterly GDP data,” said Erik Randolph, GCO’s director of research. “In fact, the opposite is true. There have been two times, since the availability of the data, without two consecutive real GDP declines when the Committee declared them to be recessions. This happened with their declared 1960 and 2001 recessions. Who knows if and when the NBER Committee will declare whether we’re already in a recession, and for how long. But if it doesn’t declare so despite the real GDP data, it would be unprecedented and require a good explanation. In the meantime, GDP gives perhaps the broadest measure of economic activity, giving a strong signal that we’re in a recession until such time economists work out their various methodologies to affirm or deny.”

New Research Predicts Long-Term Pain for Labor Market

New Research Predicts Long-Term Pain for Labor Market

New Research Predicts Long-Term Pain for Labor Market

social distancing

Long-term pain for labor market due to the COVID-19 pandemic

New research predicts long-term pain for the labor market due to around 3 million workers who plan to remain permanently sidelined over concerns of physical illness or physical impairment due to the COVID-19 pandemic.

The Georgia Center for Opportunity’s (GCO) take: “The authors of the long social distancing study have produced very helpful data on those no coming back into the labor force, estimating a 3.5 million shortfall in March by comparing the current observed level with a linear trend using the time period of January 2015 to December 2019 as the basis for the forecast,” said Erik Randolph, GCO’s director of research. “Using the current employment statistics survey instead of the current population survey, our own research shows a shortage of 6.6 million employed persons that would include persons holding multiple jobs. We use the same method of comparison by subtracting the forecasted data from the observed data, but instead of using a linear trend as the basis for comparison that can often overestimate the forecasts, or the reverse, we use an ARIMA forecast model, not for five years but starting at the low point after the Great Recession. In addition, our research provides forecasts and analyses for each of the 50 states where there is a wide disparity when it comes to job recovery.”

For more, read Randolph’s research report on the economic impact of the pandemic shutdowns.

 

statement