Higher grocery, electricity and gasoline bills pushed inflation in the Dallas-Fort Worth area well above the national average with a yearly increase of 9.4% in July.
The U.S. inflation rate, while still way too high for struggling household budgets, at least ticked in the right direction: down. The U.S. rate declined in July to 8.5% vs. a 40-year peak of 9.1% the prior month, the Labor Department reported Wednesday. The D-FW consumer price index, which is reported every other month, was 9.1% in May.
Shoppers said a trip to the grocery store is more of a mental exercise these days.
Shelby Scurlark was loading up her vehicle after shopping with her two kids at a Kroger store on Mockingbird and Greenville in Dallas. “They’re running around, and I’m trying to look at prices,” she said. While she used to know about what that trip would cost, now she’s having to look closely at brands and prices.
“Everything’s just going up,” she said. “It’s crazy.” Scurlark also says her rent, which started at $1,800 a month two years ago, is now $2,400.
And setting her thermostat at 77 degrees doesn’t seem to make a difference in her electric bill, which has shot up from under $100 to between $200 and $300, she said.
Anyone in North Texas shopping for a electric utility provider will find affirmation in the 47.3% increase reported in D-FW electricity costs in the latest inflation report from the Bureau of Labor Statistics’ Southwest region office.
Likewise for grocery shoppers: D-FW grocery prices increased 15.5%. And while gasoline prices have trended lower this summer, the cost to fill up in North Texas remains 43.2% higher than a year ago.
“I nitpick on everything,” said Michael Paddon of Dallas, who was heading home from Kroger on Wednesday to cook dinner for his wife. Instead of regular size Coke cans, he’s buying the cheaper minis. He spent $250 Wednesday and just bought “a little bit of meat.” If he had bought his pre-inflation basket with more meat, it would have cost at least $100 more, he said.
D-FW housing costs increased 10% in July, driven up by a 9.2% increase in rents. Other data and anecdotes all signify much higher rent prices in D-FW as demand for apartments exceeds the supply.
Demand for everything goes up in a growing economy, and Dallas-Fort Worth is growing faster than most markets, as illustrated by its job growth. The region added 293,900 jobs since last June, and that rate of growth was second in the U.S. only to Las Vegas. In absolute numbers, only New York and Los Angeles created more jobs.
Higher energy prices are imbedded throughout the economy, said Julie Percival, regional economist for the U.S. Bureau of Labor Statistics in Dallas.
But energy is taking up a disproportionate share of the increase in D-FW inflation, she said. “Normally, it might represent 10% of an increase this time of year. But now, more than one-third of the increase [from a year ago] is from energy costs.”
Higher electric bills over the past two months alone represented almost half the inflation increase since May, she said.
“It’s a big one-two punch to have the cost of shelter and utilities up at the same time,” Percival said, and that helps explain why D-FW prices are rising faster than the U.S. average.
At least the big consumer expense of gasoline is going down, she said.
Gas prices have been declining for two months, and the scary forecasts have largely gone away.
AAA spokesman Andrew Gross said it’s possible the national average will fall below $4 a gallon this week. The national average is $4.010 a gallon, down from $4.684 a month ago as the price of oil has started to decline on recession fears.
The Texas average of $3.512 a gallon, while still up from a year ago, is down significantly from $4.241 a month ago, according to AAA Texas.
Paddon said he’s noticing the drop in gasoline prices as his fill-up has dropped to $50 from $65 not too long ago. But he can’t say the same about his electric bill. “I have a small two-bedroom apartment, and it’s almost $300 a month,” he said. “And that’s for an apartment that doesn’t even stay cool.”
People have cut back on driving even in this peak summer driving season, according to Energy Information Administration data. Changing driving habits is one of the few ways households can lower the price they pay for necessities.
“Consumers are getting a break at the gas pump but not at the grocery store. Food prices, especially costs for food at home, continue to soar,” said Greg McBride, chief financial analyst at Bankrate. He’s also expecting the “knee-buckling pace” of housing costs, which represented the largest slice of July U.S. inflation, to continue to move higher for months.
The 13% increase in overall D-FW food prices, which includes eating out at restaurants, was the highest since April 1979, Percival said.
While many are heralding the drop in U.S. inflation, Percival said, it may be a few more months before there’s real price relief. Lower prices take time to work their way to lower transportation and shipping costs that affect just about everything, she said.
And many households are still working through issues related to the pandemic.
“I think everybody’s all still trying to cope with everything, all the prices going up, and just trying to push by as much as possible,” Scurlark
said. “After everything calmed down through COVID, it’s still a process getting back on your feet.”
To adjust to rising costs, Scurlark said she and her husband are cutting back on personal shopping and expenses.
“You can’t even spoil yourself right now,” she said. “It’s either spoil yourself or put it to the rent.”