The cost of food rose for the sixth-straight month, rising by 0.6 percent in June, according to data released Tuesday from the Bureau of Labor Statistics. The larger-than-expected price hike represents a further pain point for millions of American families already living on the edge amid layoffs and lockdowns.
While the increase in food prices was not as large as the 2.1 percent spike in March when lockdowns first hit, it comes as consumer wallets are getting hit hard. Overall consumer prices also increased by 0.6 percent, the biggest monthly gain since August 2012, the Labor Department said.
The higher prices come as businesses and restaurants across the country are rolling back their reopenings, sending more employees back home and creating further pressure for families trying to put food on the table. Furthermore, the government’s pandemic unemployment assistance of $600 per week, which has allowed millions of people to keep their head above water, is set to expire in the last week of July.
“I will be totally screwed,” when the federal assistance ends, said Brook Garrison, a 49-year-old single mother in Brooklyn, New York, laid off from her job waiting tables at Olive Garden in March when Gov. Andrew Cuomo ordered restaurants closed.
For now, she is trying to make do by shopping cheaply, making rice and bean meals and her own marinara sauce. Once a month she spends a day cooking make-ahead meals to freeze, mainly soups and chilis. She avoids buying meat because of the high prices. If the food prices continue to rise, she said she plans on applying for emergency food services and attempting to visit food pantries. But she is worried that if a second wave of the pandemic hits, that assistance and food pantries will run dry.
“I know this COVID is going to get worse, so I’m not spending any extra money,” Garrison told NBC News.
Supermarket bills have risen as quarantined consumers began to eat all of their meals at home, increasing demand and tightening supply. Some consumers, not used to seeing bare shelves and wanting to limit the number of supermarket trips to avoid coronavirus contamination, stockpiled their pantries.
June’s increases were driven in part by surges in meat prices, with beef rising 4.8 percent, according to the Consumer Price Index, a measure of inflation. Overall, meat, poultry, fish, and eggs increased 2 percent, but have increased 12.8 percent over the past year.
Beef prices have soared recently, shooting up 20.4 percent in just the past three months. Coronavirus infections and deaths among workers in tightly packed meat processing plants have led to closures and slowdowns among the large meat packers, a critical bottleneck in the national meat supply.
Soft drinks and other nonalcoholic beverages rose by 0.7 percent last month, with cereal and bakery products and fruits and vegetables both up by 0.4 percent. The only major category to decline was dairy and related products, falling 0.4 percent, the first decrease in a year.
One small bright spot is that after completely stopping during the pandemic, retailers have started a small trickle of in-store sales and promotions, said Phil Tedesco, Director of Retail Analytics at Nielsen.
“As supply chains increasingly stabilize, retailers are better able to support promotional offers,” said Tedesco, with the number of units sold on promotion increasing since April by 2 percentage points.
“Still, promotional activity has room to grow before getting back to pre-pandemic levels,” with promotional activity in the grocery department still down 11 percentage points since the first COVID-19 cases were reported in the U.S., Tedesco said.
Regionally, the greatest price increases were seen in the Chicago, San Francisco and Atlanta metro areas, according to exclusive data from Nielsen, which tracks a basket of 37 popular supermarket items across major categories.
In the Chicago and San Francisco metro areas, the basket rose 0.62 percent to $137.16 and $157.43, respectively. In the Atlanta region the basket rose 0.36 percent to $137.
The largest price decreases were seen in the metro areas of New York (down 1.53 percent, to $153.48), Philadelphia (down by 1.05 percent, to $146.37), and Washington, D.C. (down to $145.34, or 1.14 percent).
Nationally, the basket of supermarket goods has increased by 2.8 percent since January, rising from $136.23 to $140.10.
“Overall inflation remains relatively low, but the fact is that lots of families are struggling to put food on the table,” wrote Diane Swonk, an economist at Grant Thornton, in a note. “The costs at the grocery store are rising at a staggering pace, while unemployment remains extremely high. Elected officials could do something, but Congress is still in recess. This is the hardest reality I have ever had to explain during my career as an economist.”
