It’s no secret– there’s so many reasons to love Philadelphia. From its diverse neighborhoods, nationally-acclaimed restaurants, and historical landmarks, Philly is a downright unique city. In fact, it was recently voted the #1 city to visit in 2024. However, what isn’t so attractive about the City of Brotherly love is its high inflation rate. In a recent study, Philadelphia ranked in the top five metropolitan cities plagued with the highest rates of inflation across the nation.
Inflation On The Rise In Philly
In a recent study published Tuesday, WalletHub did a deep into changes of inflation across the United States. Indeed, inflation has been a nuisance for the country on a whole. Specifically, in the post-pandemic era around May 2022, the inflation rate reached a staggering 8.6% –the highest it’s been since 1981!
However, more recently this rate has dropped significantly due to factors such as the Federal Reserve rate hikes. Although not quite at the target rate of 2%, year-over-year inflation rate in the U.S. sits at 3.2% as of February 2024.
On the contrast, the study concluded the metropolitan statistical area of Philadelphia-Camden-Wilmington is slightly higher than the national average.
Specially, the rate of inflation in Philadelphia and this area is 3.4%, one of the top 5 in the country.
Miami ranked #1, followed behind Dallas, St. Louis, and Seattle.
What Are Some Contributing Factors To This?
Undeniably, factors impacting the rise varies. Wenyi Shen, Associate Professor in the Department of Economics at Oklahoma State University and Spears School of Business, was consulted by WalletHub on contributing factors. Shen explained, “the unprecedented expansionary monetary easing and fiscal measures deployed during the pandemic, along with supply-side shocks such as global supply bottlenecks and the Russian-Ukraine war during and after the pandemic, are considered crucial factors driving inflation.”
Eric Leeper, a Paul Goodloe McIntire Professor in Economics at the University of Virginia, echoes the impact of the pandemic on current status. He explains, “the impetus to inflation was unquestionably the $5 trillion in Covid-related fiscal spending. At the time, policymakers communicated that these were gifts, rather than loans that would be paid back through higher taxes.”
Specifically in Philadelphia, the cost of food, energy, apparel, and housing have all increased thus contributing to the city’s high inflation rate. A report by the U.S. Bureau of Labor Statistics breaks down these rising costs.