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LA-Area Consumer Prices Increasing At Rate That Is Double The National Average

Prices for consumer goods in the Los Angeles area, including in Santa Clarita, have increased at a rate that is double the national average over the past year, officials said. 

The consumer price index (CPI) for the Los Angeles area increased 3.3 percent in comparison to June 2018, more than double the national increase of 1.6 percent, according to a report from the Bureau of Labor Statistics and the United State Department of Labor.

“Anytime we see an uptick in key Consumer Price Index indicators, we should be cautious on what it means to our economy long-term,” said John Musella, president and chief strategist at The Musella Group, a member of the Santa Clarita Valley Chamber of Commerce. “Today, the economy is continuing to do well and we haven’t seen a decrease in consumer spending.”

One of the principal drivers of the increase was the energy category, which increased 2.3 percent year over year, largely due to a 6 percent increase in the price of electricity.

“Overall increases in the CPI will mean that consumers will have less discretionary money to spend, or they’ll make some changes in their spending behavior,” Musella said. “Our unemployment numbers in the Santa Clarita Valley and LA County remain low, which are very good economic indicators.”

Another area of increase highlighted by the report was the cost of food.

Over the year, food prices increased by 3.0 percent. Prices for food away from home rose 4.8 percent since a year ago, and prices for food at home rose 1.3 percent,” the report reads.

The Los Angeles housing market also continued to increase in cost, as the price of shelter increased 5.1 percent over the last year, and rent — a subcategory of shelter in the report — increased 5.8 percent.

Another category that may potentially impact Santa Clarita residents is “tuition, other school fees and child care,” which rose 7.6 percent annually.

Despite these increases, local officials continue to see positive signs for the Santa Clarita business community.

“We are continuing to see businesses interested in locating to the Santa Clarita Valley, which is good news for our local economy,” Musella said. “I believe that we need to be vigilant in ensuring that LA County and the State of California do not over-regulate or increase fees and taxes which could stall the economy, decrease consumer spending or hurt the profitability of our local businesses.”

The Los Angeles-area report is available in its entirety here.


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LA-Area Consumer Prices Increasing At Rate That Is Double The National Average

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About Wyatt Smith

Wyatt was born and raised in Santa Clarita. After graduating from Hart High School in 2012, he continued his studies at the University of California, Santa Barbara, where he earned a degree in applied statistics. After a year and a half working in the digital advertising industry, Wyatt left his previous field of work to pursue his interest in writing.