US inflation explodes to 9.1% in June even as U.S. tech layoffs top 20,000

A few minutes ago, the US Labor Department (DOL) released devastating inflation numbers for the month of June. The numbers are not looking good. In fact, it’s getting worse. According to the report, US inflation jumps by 0.5 percent from May to hit 9.1% in June, the largest 12-month increase since November 1981.

As CNBC noted, the consumer price index (CPI) increased 9.1% from a year ago in June, above the 8.8% Dow Jones estimate. The current inflation number also does not take into the cost of food, gasoline, groceries, rent, and dental care. The bad news did not end there. Workers’ hourly wages fell 1% during the month and are down 3.6% from a year ago when adjusted for inflation.

Inflation rose 9.1% in June, even more than expected, as price pressures intensify https://t.co/aQ1PskuTba

— CNBC Now (@CNBCnow) July 13, 2022

The Bureau of Labor Statistics (BLS) shared:

“The Consumer Price Index for All Urban Consumers (CPI-U) increased 1.3 percent in June on a seasonally adjusted basis after rising 1.0 percent in May, the U.S. Bureau of Labor Statistics reported today. Over the last 12 months, the all items index increased 9.1 percent before seasonal adjustment.

The increase was broad-based, with the indexes for gasoline, shelter, and food being the largest contributors. The energy index rose 7.5 percent over the month and contributed nearly half of the all items increase, with the gasoline index rising 11.2 percent and the other major component indexes also rising. The food index rose 1.0 percent in June, as did the food at home index.”

The ripple effect of inflation is everywhere including in the tech sector. So far, at least 50 tech companies have either laid off their employees or plan to do so in the near future.

As of July 7, there have been at least 20,000 employees laid off in mass job cuts in the U.S. tech sector so far this year, according to data layoff tracking data from CrunchBase. More tech companies are also planning to trim their workforces to counter market challenges amid the global economic downturn.

Meanwhile, US Treasury Secretary Janet Yellen admitted that she was wrong a year ago when she said she anticipated inflation would be “a small risk,” and “manageable. In an interview with CNN’s Wolf Blitzer,  Yellen said:

“I think I was wrong then about the path that inflation would take. As I mentioned, there have been unanticipated and large shocks to the economy that have boosted energy and food prices and supply bottlenecks that have affected our economy badly that I didn’t at the time … fully understand. But we recognize that now.”