The highest inflation in four decades has especially pummeled people who are low-income, including those sometimes called “the working poor” who are employed and whose incomes fall below the federal poverty line. Government statistics and other numbers offer clues as to why.
In “Cleveland storefront helps people fight inflation on the homefront,” Signal Cleveland tells the story of how a grassroots nonprofit organization on Cleveland’s East Side, Another Chance of Ohio (ACOO), has been on the front line of helping low-income residents who are desperately attempting to cope with rising costs.
Here are some of the numbers pointing to why the nonprofit has seen demand for some of its programs about double since 2021.
Inflation measure remains high
The Consumer Price Index is a major federal government statistic used to measure inflation. The CPI is based on a market basket, or a proportionately selected group of goods and services that include food, utilities and gas. The latest CPI shows prices rose 6.5 percent between December 2021 and December 2022.
The CPI has fallen, but it remains high. For example, for the 12 months ending in November, it was 7.1 percent. For the 12 months ending in June, it was 9.1 percent. The Federal Reserve aims for inflation to run at 2 percent.
The Bureau of Labor Statistics also does a CPI for the Midwest. It shows how food prices have spiked. The story on ACOO points to how food insecurity appears to be on the rise. This may worsen when the federal emergency allotment for Supplemental Nutrition Assistance (SNAP) benefits ends in February.
The Midwest region CPI shows that food prices increased 11.4 percent between December 2021 and December 2022. That’s the average for all items. Some food prices increased even more dramatically, including cereal, bakery and dairy products, all of which rose 16.7 percent.
Housing costs were up 6.6 percent in the Midwest for the same period. Electricity increased 9.1 percent and gas to heat homes rose 16 percent.
United Way 2-1-1 calls
The type of assistance people are seeking when they call the United Way 2-1-1 Help Center could indicate how the jump in the costs of essential goods and services is straining low-income residents. The center recorded nearly 175,000 needs from Cuyahoga County clients between July 2021 and December 2022. Assistance for utilities, rent and food have dominated, and many people have needed referrals to emergency homeless shelters.
“[W]e can see that [for] the most recent months, June through December of 2022, we have seen a larger-than-usual number of requests for food and utilities,” Michelle Snowden, manager of 211 Navigation Services at United Way of Greater Cleveland, wrote in an email to Signal Cleveland.
Two snapshots in time of people seeking help from food pantries could point to rising food insecurity. Food pantries ranked third in December 2021, with 2-1-1 logging 668 requests. By December 2022, food pantries ranked first, with 1,103 requests.
Robert Fischer, co-director of the Center on Poverty and Community Development at Case Western Reserve University, said public policy could play a role in addressing food insecurity.
“We built these support systems, like food stamps [SNAP], that don’t change quickly even when you see this huge increase in food costs,” he said. “When people cannot do anything else to stretch their dollars, they end up at the pantries.”
Tying subsidies such as those for SNAP to inflation, at least during this 40-year high, could offer a solution, Fischer said.