14% of employees are concerned about a recession
New data released by the U.S. Bureau of Labor Statistics (BLS) shows that inflation, while slightly cooler compared to last month, is still running at a high pace. The Consumer Price Index (CPI) for all items rose 6% for the 12 months ending in February before seasonal adjustment. This is down from the 6.4% annual gain observed in January. The CPI rose 0.4% in February after increasing 0.5% in January, with shelter accounting for more than 70% of the increase. The food, recreation, and household furnishings and operations indexes also contributed to the increase.
Excluding food and energy, core inflation rose 0.5% in February after rising 0.4% in January, the BLS said. Despite the slight decrease in inflation, the data indicates that it is still extremely problematic, causing fears among consumers about unrelenting high costs and other financial pressures. Persistent inflation has taken its toll on most factors of employees’ lives, including their emergency savings, retirement contributions, and mental health.
Real average hourly earnings decreased 1.3% from February 2022 to February 2023, and the change in real average hourly earnings combined with a decrease of 0.6% in the average workweek resulted in a 1.9% decrease in real average weekly earnings over this period, the BLS reported separately on Tuesday.
In addition, other financial pressures like the collapse of Silicon Valley Bank, America’s 16th largest commercial bank, on Friday, have caused fears among investors about whether a broader banking meltdown is imminent.
According to Telus Health, a Vancouver-based healthcare firm, more than one-third (36%) of employees are concerned about inflation, and 14% are concerned about a recession. The latest index surveyed 5,000 U.S. workers.
Paula Allen, Global Leader of Research and Total Wellbeing at Telus Health, a Vancouver, British Columbia-based health care firm said: “We don’t feel a sense of control over this inflation. This financial risk impacts our mental health: are we going to pay for groceries? Do we need to cut back on health expenses? It’s not a small thing. It erodes our emergency savings as well, which is a big thing—having that cushion is a big, big thing for mental wellbeing.”