Food Fight! (Part One)
Reporting on the increasing cost of food
What’s something that journalists do, truck drivers do, bosses do, administrative assistants do, dads do, moms do, babies do, kids do, college students do, young marrieds do, grandparents do? You guessed it! Eat. Everybody eats food.
I’m going to take a ‘wild’ guess that you have noticed the rise in grocery prices during the past few years. Do you think your audience has noticed? You bet they have! So, how are they handling the increase in food costs? Are wage increases keeping up with those costs? Are they having to make tough life choices because of the higher costs?
Sounds like a great news story or series of stories for you. Here’s some information that might help with your stories. But first .. a personal perspective.
Personal Food Perspective
I worked at a grocery store and a couple of restaurants while I was in high school and college (starting in 1964), and for a natural food manufacturer decades later after a career in television news. The years between included getting married, raising children, and watching them eat. What that means is we bought a lot of food to consume at home, along with occasional trips to restaurants and fast-food locations.
One thing I noticed between 1964 and 2023 is that the cost of food, whether consuming at home or away from home, rose in cost. I remember working as a ‘bag-boy’ at a grocery store in high school during the mid-60s and people were complaining about the ‘high cost’ of food back then as well. How high? Here are some examples from 1964 when I first placed food items into large paper bags for customers —
A pound of white bread cost 21 cents
A dozen fresh eggs cost 54 cents
10 pounds of potatoes cost 76 cents
1 pound of round steak cost $1.04
1 pound of sliced bacon cost 67 cents
Broiler chickens were 29 cents per pound
Fresh carrots were 9 cents per bunch
A 12 oz box of Kellogg’s® Corn Flakes was 25 cents
Half gallon of ice cream cost 79 cents
Tide® detergent was 19 cents
1 pound of Nabisco® Oreo Cookies was 39 cents
My parents had fresh milk delivered to their doorstep every morning from a local dairy. Cost? 53 cents for half-a-gallon. The milk came in glass jars that we returned empty in a small metal container for the ‘milk man’ to pick up the next day.
How would you like to see some of those prices return to your local grocery store? Not going to happen. Food prices have risen consistently for decades. Any chance prices will come down in the future? Here's the first paragraph in an online story from a year ago —
Inflation continues to drive the cost of groceries higher and higher, according to data from the Bureau of Labor Statistics. Grocery prices in March of 2022 were 10% higher than they were during the same month last year. Grocery Store Price Comparison
That was 2022. Fortunately, costs have been going down a little since then. However prices are still rising and more financial pain may be on the way. This story came out just last week —
An 11% increase in gas prices in August fueled a chilling surge in consumer price index inflation, which rose to 3.7% for the year ending last month. That's up from 3.2% in July and nearly twice the Federal Reserve's maximum inflation target of just 2% annually.
Between August's CPI print and core PCE inflation increasing in July for the first time since January, there's no doubt about it: The worst inflation crisis in 40 years, which seemed to be abating earlier in the summer, is heating up again.
Overall average prices have already increased by 16% since President Joe Biden took office, but the disproportionate growth in essentials, which comprise a greater share of budgets for lower-income households, has meant the least privileged have paid the highest burden. For example, the consumer price index specifically for food is up 19% since January 2021, and electricity prices are up 23%. In the last month alone, food and electricity prices increased by 0.2%. Shelter prices, which increased by 0.3% last month and more than 7% over the past year, have also been a major driver of inflation's resurgence.
But the most ominous finding in this latest release from the Bureau of Labor Statistics is that headline CPI rose by more than 0.6% last month. That's the fastest single-month increase since June of last year, when the annual measure peaked at 9.1%. A 0.6% monthly increase translates to a 7.2% annualized rate, or nearly four times what the Fed considers acceptable. Washington Examiner
That sounds a bit concerning, so let’s dive into the numbers and see how we can ‘humanize’ them for our viewers, listeners, and readers. Remember to tell stories through the lives of real people. That’s an important part of Real Journalism.
Food Price Future
The U.S. Bureau of Labor Statistics reported that food prices increased almost 5% between July 2022 and July 2023. “Food at home” increased by 3.6%. “Food away from home” increased by 7.1%.
Where are food prices going during the next 12-18 months?
Food prices are expected to grow more slowly in 2023 than in 2022 but still at above historical-average rates. In 2023, all food prices are predicted to increase 5.9 percent, with a prediction interval of 5.3 to 6.5 percent. Food-at-home prices are predicted to increase 5.2 percent, with a prediction interval of 4.4 to 6.1 percent. Food-away-from-home prices are predicted to increase 7.1 percent, with a prediction interval of 6.8 to 7.5 percent. Food prices are expected to continue to decelerate but not decline in 2024. In 2024, all food prices are predicted to increase 2.8 percent, with a prediction interval of -2.0 to 7.9 percent. Food-at-home prices are predicted to increase 2.1 percent, with a prediction interval of -5.1 to 9.9 percent, and food-away-from-home prices are predicted to increase 5.1 percent, with a prediction interval of 2.7 to 7.5 percent. U.S. Department of Agriculture
Oil and food prices have jumped in recent weeks, and wages are still growing strongly in some of the world’s biggest economies. The battle to bring inflation down is far from over.
“It would be foolish for any central bank to declare victory,” Randall Kroszner, a former governor of the US Federal Reserve System and now an economics professor at the University of Chicago Booth School of Business, told CNN. CNN Business
New data on consumer confidence shows that Americans are less confident about the U.S. economy, pointing to higher grocery and gas prices.
"Consumer confidence fell in August 2023, erasing back-to-back increases in June and July," Dana Peterson, Chief Economist at The Conference Board, said in the announcement. "August's disappointing headline number reflected dips in both the current conditions and expectations indexes. Write-in responses showed that consumers were once again preoccupied with rising prices in general, and for groceries and gasoline in particular." The Center Square
Here’s an interesting quote from an article titled What Causes Inflation? We Spoke to Former Atlanta Fed President Dennis Lockhart —
Hedder: What do you think is the most misunderstood or underappreciated aspect of this current inflation situation?
Lockhart: There is a long-held belief that inflation is a monetary phenomenon in the end, but what may be missed is that we currently have a novel set of circumstances that are not entirely monetary in nature.
Non-monetary drivers of inflation
The origin of this inflationary period was a public health shock. That gave rise first to a very sharp decline in employment, then a very sharp rebound in employment, and extraordinary fiscal stimulus. Combined with the fact that Russia invaded Ukraine, which put pressure on energy prices and food prices, it became an unusual set of circumstances, very little of which can be tied to monetary policy per se.
These are real world factors that are not even entirely economic in nature. This is not your grandfather's inflation. This is a set of novel circumstances that we have not seen before, and the monetary authorities are trying to tackle that with the tools they have, but the tools don't necessarily address every underlying cause of the inflation picture. Nasdaq
Older people living on Social Security are especially impacted by rising food prices. Be sure to include them in your stories as well —
More seniors are pointing to food costs as an ongoing concern, according to the Senior Citizens League, an advocacy group for older Americans.
"According to our latest survey, 63% rated food costs as the category of spending that increased the fastest in their household," said Mary Johnson, Social Security and Medicare policy analyst at the Senior Citizens League. "This is up from 58% who reported food costs as their fastest-growing category of spending this time a year ago."
She added, "Food was the leading pain point last year as well." CBS News
“I Never Thought, at 71 Years Old, That I Would Be in This Position”
An alarming number of baby boomers are living paycheck to paycheck — and even slipping into homelessness. What’s going on?
The aging of America means more old people on fixed incomes are overwhelmed by the high cost of housing and other financial shocks; 'not seen since the Great Depression.' Wall Street Journal
Lower-income families are also hurt by rising food prices. The Federal Reserve Bank of New York put it this way —
As of December 2022, the bottom 40 percent have the highest year-on-year inflation rate of the three groups, and the inflation rate of the middle-income group is below the national average. It is likely the case that the same rate of inflation represents a greater welfare loss for lower-income than higher-income households because of the former’s lower capacity for substituting to less expensive goods, greater liquidity constraints, and larger marginal utility of real income. Federal Reserve Bank of New York
One more from CNN —
Real personal income was flat in July, real disposable personal income (real personal income minus taxes) dropped in July for the first time in 13 months and the personal savings rate dropped in July. Meanwhile, consumer spending jumped in July, according to the Bureau of Economic Analysis. That all suggests that US consumers may be getting out over their skis with their buying habits.
To be sure, the tight labor market is still driving incomes up, but not as quickly as last year. And the Fed is intent on softening up the labor market to further curb inflation by targeting wages.
So, if spending growth is starting to exceed income growth, how are Americans paying for things? The answer is debt and savings, neither of which is sustainable.
Further evidence of an increasingly stretched consumer can be seen elsewhere. Hardship withdrawals from 401(k) accounts have jumped, retail theft is spiking and retailers report that consumers are increasingly focused on discount brands.
None of this bodes well for future spending, nor do the mandatory student loan repayments set to resume in October. Indeed, following a three-year hiatus, millions of Americans will have to start diverting a part of their monthly paycheck back to these payments. This could potentially lead to a spending cut of about $9 billion per month, increasing the probability of recession. CNN (Opinion)
Most Expensive States
The cost of food items also depends, to some measure, on where you live. Here are some websites you can visit to read more about the cost of food in each state, and some cities. Some of the sites include other spending categories (e.g. housing costs, transportation, etc), so you may want to search for the words “food” or “groceries” if that information is not at the top of the page —
The Average Cost of Food in the US
AVERAGE COST OF GROCERIES BY STATE [2023]
States With the Most Expensive Food Prices
2023 State-by-State Cost of Living Report: The Ultimate Guide to Affordable Living
Cost of Living Index by State [Updated June 2023]
Top 10 Most & Least Expensive States for Grocery Shopping in the US
Grocery Stores in These 10 States Are Shockingly Expensive
10 Best and Most Expensive US States To Live 2023: The Pricey Paradises
Inflation 2023: Cities Spending the Most — and Least — on Groceries
Next Newsletter
I’ll put on my old ‘news manager hat’ next week and share some specific story and series ideas for covering this local, regional, national, and international Food Fight. I’ll also share info about how wages are keeping up (or not) with food price increases.
Comments and Questions Welcome
I hope these thoughts are helpful to you. Please share your comments and questions and I’ll respond as quickly as I can. If you like what we’re doing in this newsletter, please let your friends know about it so they can subscribe.
Newsletter Purpose
The purpose of this newsletter is to help people who work in the fields of journalism, media, and communications find ways to do their jobs that are personally fulfilling and helpful to others. I also want to help news consumers know how to find news sources they can trust.
