Inflation is a significant factor in the lives of people and businesses. It is mind-boggling to think that everything we see, need, and purchase has been affected by inflation. While some industries feel the effects more than others, it still leads to businesses and households having to make difficult choices to keep everything within budget.
Inflation is both good and bad. Too little inflation isn’t good for an economy and can cause it to weaken, but too high an inflation rate can be just as harmful.
What exactly is inflation anyway? In simple terms, inflation is a general increase in price and a decrease in the purchasing value of money. There are many causes of inflation – from natural disasters like flooding and wildfires to printing more money.
It is important to understand how inflation affects certain parts of the economy to make necessary budget changes. This article will explore three industries: education, health and fitness, and health care.
Health Care
While the current inflation rate is raising a few brows, healthcare costs are increasing at an even more alarming pace. It is scary to think it is rising at an even faster rate than inflation. Many contributing factors account for this drastic increase in the cost of health care, and inflation is one of them.
According to the U.S. Labor Department’s Bureau of Labor Statistics, “The average price of healthcare in the United States increased 5.0% in the 12 months ended October 2022.” This means the cost of medicine, medical equipment, and the costs of running a hospital also increase, making health care more inaccessible year by year. How long will it be before it becomes unaffordable altogether?
Gyms And Wellness Clubs
Inflation creeps into every aspect of life, even health, and fitness. As the costs of transport and raw materials increase, so does the cost of manufacturing items; this extends to gym equipment. While inflation hasn’t hit this industry as hard as others, prices for gym equipment are still 7.78% higher in 2022 than in 1978.
In addition, health and fitness supplements like protein powders, greens powders, whey protein, and BCAA supplements also see a price increase. Take whey as an example: Whey is a product manufactured from cheese. As the cost of production and transport of cheese increases, so does the price of the products made from cheese.
As a result of these increased costs, gyms may need to raise their prices and membership fees, which could lead to a loss in their client base and reduce the number of potential new customers signing up.
Education
Taking a look at the education sector, inflation has taken its toll. On average, education has experienced an inflation rate of 4.50% per year, a 258,51% increase from 1993 to 2022. This means higher student loans, higher prices on books, supplies, and a steadily rising cost of tuition. This can see increased pressure on families and students as they struggle to keep up with the costs, leaving others unable to afford education altogether.
Final Thoughts
Businesses and households must understand how inflation impacts different aspects of their lives so they can make necessary adjustments to their budgets to ride out the tide of inflation. Inflation does have the purpose of serving in strengthening the economy. Still, it is also essential to consider the inverse effect of an inflation rate that is too high and becomes harmful.