From Retirement to Salary Negotiation, Here’s How Workers Can Deal with Soaring Inflation

From fruit to fuel, everything seems to be getting pricier…and pricier. It’s not just your imagination: the average price of goods climbed about 8.5% in the 12 months ending in March, per new data released by the Bureau of Labor Statistics on Tuesday. That’s up nearly four-fold from one year ago, when the consumer price index (CPI) was just 2.6%.

The CPI, a measure of the changing average price of goods that’s often used as an inflation benchmark, hasn’t soared with such gusto since late 1981, when the economy was catching up to an oil crisis and big government spending. Russia’s war against Ukraine is putting a similar strain on global supply chains today, exacerbated by economic sanctions imposed by the U.S. on Russian oil and other goods. The BLS reported that gas, housing and food costs were the greatest price pushers. Gas prices shot up 18.3% in March alone, while overall food prices grew by 1%, the data showed.

When inflation rises, your dollar doesn’t go as far as it used to. So, what does this sticker shock actually mean for your wallet? From career planning to retirement, many Americans are rethinking how they manage money and plan for the future. Here’s a round-up of articles striving to make sense of the situation:

Salaries

If your salary didn’t increase by at least 8.5% over the past year, you’ve effectively taken a pay cut. Read up on how you can use inflation to frame your salary negotiations and navigate uncomfortable conversations about pay with your current (or future) employer. (Morning Brew)

Career changes

Changing jobs–or careers–is typically the quickest way to increase your pay in a big way. Nearly one-third of workers who switched jobs during the pandemic saw pay bumps of at least 30%, which could help them deal with inflation. (HR Dive)

But there’s also concern that job-hopping may actually be contributing to inflation. In fact, switching to higher-paying jobs may have contributed to about 20% of the price growth seen in 2021, the Chicago Federal Reserve reckoned. (Reuters)

Retirement

The pandemic prompted many Americans to accelerate their retirement plans. But with prices on the rise, nest eggs aren’t what they used to be–and some retirees are rejoining the workforce in order to cover their expenses. (The Wall Street Journal)

Personal finance

Inflation is an important aspect of career-planning these days, but it’s also essential to take stock of your current financial situation before making any big decisions. From budgeting to investing, here are five ways to rethink your personal finances amid runaway inflation. (Forbes Advisor)

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