U.S. Minimum Wage Hikes, Rollback Of Stimulus To Stem Inflation

Wages are going up, as are home values, so many Americans won’t necessarily feel the sting of rising prices on everyday goods. Starting this weekend, 21 states rolled out minimum wage increases, Allison Morrow reported for CNN.

Photo Insert: Salaried workers in America can expect their biggest base pay bump in over a decade.

Salaried workers in America can expect their biggest base pay bump in over a decade. It comes just as a record 4.5 million Americans voluntarily left their jobs in November, pushing the quits rate up to 3%. The departures came largely from the hospitality and health care industries — lower-wage sectors directly hit by the pandemic.

Homeowners can expect to see their property values keep rising, albeit at a slightly less bonkers pace than last year. Inflation also benefits people with fixed-rate debt, like a 30-year mortgage.

Still, inflation is sitting at a nearly four-decade high, and that won’t go away just because we turned a new digit on the odometer. Blame the usual suspects: Supply-chain bottlenecks exacerbated by high demand; commodity price surges that are driving up prices of food and energy, and; big corporations seizing the moment to jack up prices on consumers and fatten profit margins.

President Biden has been hitting that last point hard, and on Monday the White House said it would allocate $1 billion to boost competition in the meat-processing industry and lower prices for consumers.

Even as the latest inflation indicators show a slight slowdown in price increases, Anneken Tappe reports it may take months for such incremental changes to show up in the data economists use.

And just to keep everyone on their toes, the Omicron variant has emerged as a wild card that could once again upend consumer behavior.

The Federal Reserve, which is tasked with keeping prices stable, is rolling back its pandemic-era stimulus policy – amounting to tens of billions of dollars being pumped into financial markets each month — and is expected to begin raising interest rates in the first half of the year. That two-prong strategy should help bring prices down, especially as supply-chain bottlenecks ease around the world.

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