GSU professor discusses national rising rate of inflation, local impacts
SAVANNAH, Ga. (WTOC) - Traveling to see family over the past year has been limited due to COVID-19 restrictions.
A jump in consumer prices around the county are up. Everything from gas prices to hotels, airfare, and car rentals.
While experts say that inflation is a natural phenomenon taking place all around the country, one tourism economics official says that part of the reason for the rise in prices is the increase in wages.
He says that the struggle to bring employees back to work is forcing employers to raise wages. But in comparison to before pre-pandemic prices, the numbers are still relatively low.
The rising rate of inflation was really inevitable coming out of a pandemic economy according to the Georgia Southern University professor WTOC spoke with Wednesday.
Dr. Michael Toma, Professor of Economics at Georgia Southern University’s Parker College of Business singled out used car prices now 40-percent higher compared to this time last year as an example of inflation. Even if you’re not in the market for a used car, higher prices for groceries, gas and other consumer goods have many Americans passing on pricier items and finding cheaper substitutes.
Dr. Toma says, though, it’s important to look at the inflation numbers in context, especially when comparing an economy in the grips of a pandemic to one recovering.
“The numbers right now are grabbing all the headlines. Five percent, six percent, producer price index - six and a half percent, the biggest increases in 20 years, or whatever it happens to be. Those are headline grabbing data points that quite honestly are partially distorted by just where the economy was a year ago as compared to where it is now,” said Dr. Toma.
Toma added there might be some inclination to blame inflation rates on national leadership from the White House to Congress, and said “Regardless of who was the president before or after that, you’re going to see a significant macroeconomic effects that completely overshadow which party is in control of the White House or Congress or whatever.”
Dr. Toma says in about three to six months, by year end, it’s reasonable to say we should start seeing prices and inflation level out.
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