The rise in the national average for the price of candy and gum far exceeded the average for all groceries after inflation hit the sector hard, according to Datasembly.
The national price for candy and gum rose 12.8% from October 3, 2022, to October 7, 2023, while the index for the entire grocery category only rose 6.7%, according to data compiled by Datasembly. Despite the big increase, it was still less than the same time period from the previous year, which saw a 19.9% increase year-over-year, which this year’s increase compounded on top of.
“In an economy where shoppers are becoming more selective and careful with their dollars, manufacturers are hoping that candy maintains its strong position with consumers’ discretionary income,” Datasembly said in its report. “Our weekly out-of-stock store-level measurements by brand suggests the demand continues, but with the increased economic pressure, we also expect to see more promotional activity as brands and retailers work to win consumers and satisfy a sweet tooth, albeit an increasingly expensive sweet tooth.”
A key contributor to the inflation seen in the candy sector is the rise in the price of cocoa and sugar, according to Datasembly. The index is based on data collected from over 150,000 stores across more than 200 different retailers in the U.S.
Consumer sentiment, a survey of how Americans feel about the health of the economy, has still yet to recover from the COVID-19 pandemic, measuring 67.9 index points for September, compared to the 90- index point and up range that was common from 2015 to 2020, according to the Federal Reserve Bank of St. Louis (FRED).
“The price of candy has gotten to be outrageous,” Jessica Weathers, a small business owner in Shiloh, Illinois, told The Associated Press. “It doesn’t make sense to me to spend $100 on candy.”
Personal Consumption Expenditure(PCE), which measures the amount that Americans are spending on consumer goods, has remained elevated since the COVID-19 pandemic after peaking at an increase of nearly 30% for the year in April 2021, most recently measuring at a 5.9% increase year-over-year, according to FRED
The rise in prices varied by state, with the lowest being Alaska, Michigan and Ohio, which only saw increases for the year of 7.1%, 7.5% and 8.1%, respectively, according to Datasembly. The East Coast was hit especially hard, with Vermont, Maine and Pennsylvania rising 14.7%, 14.2% and 14.1%, respectively, year-over-year.
Inflation peaked at 9.1% year-over-year in June 2022, decelerating to 3.1% in June of this year before rising again by 3.7% for the year in both August and September.
The Federal Reserve has sought to tame inflation by raising its federal funds rate to a range of 5.25% and 5.50%, the highest point in 22 years, after a series of 11 hikes that started in March 2022. The Fed will have the opportunity to further adjust interest rates at its next Federal Open Market Committee meeting which begins on Oct. 31 and ends on Nov. 1.
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