Despite the Federal Reserve’s aggressive rate hikes to combat inflation, the latest report from the U.S. Department of Labor shows the consumer price index rose 0.4% in September and is up 8.2% from a year ago.

That’s more than expected, up slightly from the monthly 0.3% Dow Jones Estimate, according to the Bureau of Labor Statistics, and more than a 8.1% yearly increase economists surveyed by The Wall Street Journal had expected. The 8.2% is still down slightly from its peak of 9% in June, but it’s sticking stubbornly around the highest levels seen since the 1980s.

Mountain West states, including Utah, continued to see the highest regional inflation in the country in September, coming in at 9.6% up year over year.

Why is inflation still up? Cost increases in shelter, food and medical care were the largest contributors to the monthly uptick, according to the Department of Labor.

While those costs were partly offset by a 4.9% decline in gas prices, food prices are continuing to rise up 0.8% from the month before. Energy prices fell 2.1% over the month along with gas prices, but natural gas and electricity costs increased. Year over year, energy prices increased 19.8%, and food was up 11.2%.

August inflation ticks down to 8.3% but basic necessities still on the rise

What it means: It’s not good news. It shows inflation continues to rise despite the Federal Reserve’s aggressive tactics. The Fed has raised benchmark interest rates three full percentage points since March, and Thursday’s report is likely to prompt another 0.75% hike when the Fed meets again at the beginning of November. Traders say there’s a 98% chance of that happening, CNBC reported.

The higher-than-expected numbers sent stocks plunging Thursday morning. The Dow fell 556 points or 1.9%, the S&P was down 2.2% and the Nasdaq Composite was down 3%, CNN reported.

There was some good news, however, for seniors Thursday morning. The Social Security Administration announced an 8.7% increase in benefit checks starting next year as a response to record inflation rates. It’s expected to help about 70.3 million Social Security beneficiaries, and is expected to bring a monthly increase of $150 per month on average to Social Security checks, The Washington Post reported.

How worried are Utahns about inflation?

It’s an issue that’s top of mind for almost all Utahns. A whopping 93% say they’re concerned about inflation, while only 6% say they’re not concerned.

More specifically, 64% said they’re “very concerned,” 29% said they’re “somewhat concerned,” 5% said they’re “not very concerned” and only 1% said they’re “not at all concerned.”

That’s according to the latest Deseret News/Hinckley Institute of Politics poll, which has been gauging Utahns’ worries about inflation for months. The number of Utahns citing inflation as a top worry has been on the rise since a July 2021 Deseret News poll that found 85% of Utahns were very or somewhat concerned about inflation and another check-in in February 2022 when 93% of survey participants registered concerns about the rising costs of goods and services.

October’s reading is only slightly down from last month’s poll, which found 96% of Utahns said they were very or somewhat concerned about inflation and 4% were not very or not at all concerned.

Dan Jones & Associates conducted the poll of 801 registered Utah voters from Oct. 3-6. It has a margin of error of plus or minus 3.46 percentage points.

Concerns about inflation weigh more heavily on Republican and conservative minds than it does Democrats and liberals, though a majority of both party affiliations say they’re worried. Almost three quarters of Republicans, 72%, said they’re very concerned, while 23% said they’re somewhat concerned. For Democrats, 42% said they’re very concerned, while 46% answered somewhat concerned.

Worries also span fairly evenly across Utahns regardless of income, according to the poll.

Zachary Maxfield places pieces of chicken on his smoker as he and his wife Lea prepare dinner for their family and friends at their home in Clinton on Wednesday, Oct. 12, 2022. | Scott G Winterton, Deseret News

‘We’re feeling it’

Zachary Maxfield, a 36-year-old father who lives with his wife and four kids in Clinton, said he answered “very concerned” when pollsters asked about his feelings about inflation.

“It’s driving our markets out of control,” Maxfield said, adding he’s watched as the Federal Reserve’s fight with inflation has driven borrowing rates higher and higher, which has had an indirect but unmistakable impact on mortgage rates, which now hover around 7%. The impact on the housing market has been swift and brutal.

“I feel bad for people trying to get into homes now,” Maxfield said. Fortunately, the Maxfields were able to start building their new home in the summer of 2021 when interest rates were low and moved in about six months ago. Maxfield said he can’t imagine what it would be like to try to finance a home today.

“I don’t understand how they’re going to be able to sell homes or people (are going to be able to) get into homes,” Maxfield said. Meanwhile, “rent’s unaffordable,” he said, adding that he was paying almost $2,000 a month for a two-bedroom townhome not long ago.

It’s not just housing. Maxfield said his family’s weekly grocery spending has gone up from about $150 to now $300.

How much is inflation adding to your monthly budget? Here’s what we heard in a new poll

“We’re feeling it pretty hard,” he said. Even though there’s been chatter about fuel prices trending down, Maxfield said the past few months have been hard on his family gas budget. And traveling in general has been wildly expensive.

“We just went on a family vacation, and I’ve never paid so much for a family vacation in my life,” he said. They took a trip to Germany, he said, and what used to cost him $4,000 cost $11,000.

Maxfield identified himself as a moderate Republican, with family on both sides of the political spectrum. Republican or Democrat, he said no one is saying “they’re glad where the economy is at.”

The Federal Reserve “waited way too long” to start addressing inflation concerns, Maxfield said, and now he’s worried it will send the U.S. economy into recession.

“In my opinion, I have a feeling it could be pretty bad,” Maxfield said. “You know, everything’s just becoming unaffordable, and wages aren’t going up with inflation the way it should.” He worries it’s “too late” to mitigate inflation’s impacts. “I really think we kept it too low too long.”

Maxfield, who works in the construction industry as a fire sprinkler system inspector, said he thinks he and his family will weather the storm — but he added what makes him nervous is if jobs become casualties.

“It all depends,” he said. “If the labor market crashes we’ll start seeing people get laid off. Yeah, it makes me nervous.”

Is the Fed’s inflation reduction plan working? U.S. jobs market shows signs of cooling
Lea Maxfield works on a dish as she and her husband Zachary prepare dinner for their family and friends at their home in Clinton on Wednesday, Oct. 12, 2022. | Scott G Winterton, Deseret News