KNOXVILLE, Tenn. (WATE) — Wednesday the U.S. Labor Department reported consumer prices jumped 7% in December when compared to the same time last year. That is the largest year-over-year inflation since 1982.
The Chancellor’s Professor of Supply Chain Management for the University of Tennessee feels eventually the inflation numbers will course-correct. “At some point, inflation’s going to hit a point where it’s going to start dampening demand,” said Ted Stank.
However, from grocery store shelves to car lots, there’s the common theme of emptiness. Stank said a large part of this comes on the heels of another COVID-19 surge with the omicron variant.
“Everything that we needed to come online in the supply chain side to increase our capacity is being hit by this surge and we still have demand issues going on,” said Stank. “Because of omicron people aren’t going out to eat as much so we’re not spending as much money on services and we’re spending it more on things we can do at home.”
While Stank couldn’t say when this would all end, he said it will come down to having more time before the next COVID-19 case surge. “We’ll hit a point of stabilization and we’ll get back to some kind of normalcy in the supply chain,” said Stank.
As for grocery stores, the shortages and price hikes are driven largely by labor. “Processing plants are places where there is a lot of manual labor, people working very close together, and as people got sick they had to shut plants down,” he said.
Stank predicted rolling shortages throughout 2022.
Meanwhile, the President and CEO of the Tennessee Grocers & Convenience Store Association said the omicron variant when combined with the recent weather has only made things worse in the volunteer state.
“The issue was not helped at all by the fact that we had some bad weather here in middle and east Tennessee this past week,” said Rob Ikard. “The holidays, of course, made things challenging as well.”
Ikard encouraged people to continue only buying what they need. “We’re not in any sort of food shortage situation,” he said. He also asked people to stay calm and patient knowing there will be times we go without.