Getting less for your money? Welcome to ‘shrinkflation’

On Friday, inflation in the United States hit a 40-year high.

The Labor Department says prices surged 8.6% compared to a year ago.

This means the cost of food, gas and pretty much everything is going up, and to keep prices down, some manufacturers are giving you a little less. It’s called “shrinkflation.”

“It just verified what I think a lot of people experienced in their own life,” David Vang, a finance professor at the University of St. Thomas, said.

Shrinkflation is not a new concept but it’s magnified when inflation is high. Companies might do this to try and offset any extra costs for things like ingredients, labor and transportation.

“Obviously, things are getting more expensive and pricier,” said Joe Schmidt, a frustrated consumer.

Vang doesn’t expect things to get back to normal anytime soon.

“My expectation is that inflation is going to be with us for a while, at least a year or two or more,” he said.

Vang says the last time inflation was this bad, it took a few years for the Federal Reserve to tighten the money supply.

“The ball is in the court of the Federal Reserve and they probably need a couple of years of rate hikes or consistent messaging that they’re serious about fighting inflation before it will really go away,” Vang said.

“Well, I just filled my car up it cost me $170 to fill my car up, it used to cost less than $100,” said Becky Ludwick, who is visiting the Twin Cities from Michigan.

If these higher price tags are something we all have to get used to, besides cutting back when you can, Vang does have another suggestion.

“If you have the cash and there’s something you’re planning on buying, you might want to buy it now before the prices go up even more,” he said.