Beautiful Virgin Islands

Thursday, Feb 22, 2024

What is shrinkflation, skimpflation and stagflation?

What is shrinkflation, skimpflation and stagflation?

Have you been out to your favourite restaurant, only to discover the food wasn’t quite as good or the portions were much smaller? Or even eating at home has become more expensive as the supermarket shop adds up?

You may have also just discovered that your Amazon Prime membership is about to get a little more expensive and if you are in the United Kingdom, a McDonald’s cheeseburger is also going up for the first time in more than 14 years.

The feeling that everything is just a little bit worse and perhaps more costly is not unfounded with the blame largely being placed on inflation.

But what exactly is it and the other terms that are being waved around, such as shrinkflation, skimpflation and stagflation?

Euronews Next breaks down what exactly these words mean.


Inflation


Many countries are dealing with the effects of inflation, now at a 40-year high. What that means is that you get less bang for your buck and you are now getting even less value on goods.

Basically, prices go up when there are shortages and/or there is a large demand for goods or services.

The most current example is Amazon choosing to raise the cost of its Prime membership, a decision it blamed on inflation.

Inflation is measured by how expensive goods and services have become over a certain period of time, usually a year. One well-known indicator is the Consumer Price Index, which measures the percentage change in the price of a basket of goods and services consumed by households.

Moderate inflation is considered normal but significant spikes can mean the cost of living can suddenly become much higher.

The feeling that everything is just a little bit worse and perhaps more costly is not unfounded with the blame largely being placed on inflation.


The reason why inflation is so high at the moment is due to a perfect storm of economic woes as the International Monetary Fund (IMF) on Tuesday dubbed the world’s economic outlook “gloomy and more uncertain”.

Many have blamed the world's financial problems on the impact of Russia’s invasion of Ukraine, which has consequentially ramped up petrol and food prices and seen shortages of staple goods.

But even before the war in Ukraine broke out in February, the coronavirus pandemic meant factory shutdowns and also logistical hurdles in export hubs such as China causing supply chain issues and shortages. This ramped up the prices of goods and the cost to transport them.


Shrinkflation


If you are a Swiss chocolate fan, you may remember when Toblerone in 2016 looked a bit different; it no longer resembled the Alps and had the gaps between triangles widened.

File- More valleys, fewer chocolate peaks


While the cost of the chocolate bar did not go up, it shrank from a net weight of 170 grams to 150 grams.

This is a classic case of what is called “shrinkflation,” when the volume or size of a product shrinks.

It can be seen as a little more sneaky, as consumers are less likely to weigh a product and notice the difference compared to a price hike.


Skimpflation


“Skimpflation” on the other hand is when companies “skimp” on the quality of the product or service.

One of the main reasons this happens is because companies cut back on the quality of the service so it can still be profitable, meaning less money for staffing or materials are cut back on.


Recession


If stagflation is defined as a recession accompanied by inflation, then it is important to know what a recession is.

While the word can cause alarm, recessions are a natural part of the economic cycle. A recession is defined by two successive quarters having contracting gross domestic product (GDP) results.

But issues arise if low growth is combined with unemployment or high inflation, in what is known as stagflation, which is much rarer.


Stagflation


Another word being floated around at the moment is “stagflation”. As the name suggests, everything remains stagnant and does not move much.

In economic terms, it means high inflation, economic stagnation and high unemployment at the same time. Stagflation can happen if there is a recession before the rate of inflation has gone down to where central banks want it to be.

Many countries are dealing with the effects of inflation, now at a 40-year high.


The term is said to have been widely used in the 1970s after a recession in the US hit hard and was accompanied by inflation.

The period of stagflation in the 1970s and 1980s saw several recessions and weak economic growth. It ended after the US’s national bank, the Federal Reserve, raised interest rates to curb inflation.

Newsletter

Related Articles

Beautiful Virgin Islands
London's Iconic British Telecom Tower Sold To Become Hotel
I have a dream, MLK inspiring speech
Ukraine Arrests Father-Son Duo In Lockbit Cybercrime Bust
Aretha Franklin, Marvis Staples - Oh Happy Day
US Offers $15 Million For Info On Leaders Of Cybercrime Group Lockbit
BVI Freedom Song
Russia Claims UK Cultural Agency Spied for Ukraine
Billy Preston - You Can't Beat God Giving (Live)
Apple warns against drying iPhones with rice
VIRGIN ISLANDS REGGAE CARIBBEAN RIDDIMZ
Alexei Navalny: UK sanctions Russian prison chiefs after activist's death
Oh Happy Day Edwin Hawkins - Anthony Brown w FBCG Combined Choir
German economy is in 'troubled waters' - ministry
'Stand by Me' performed by Karen Gibson and The Kingdom Choir
In a recent High Court hearing, the U.S. argued that Julian Assange endangered lives by releasing classified information.
National Anthem of the British Virgin Islands - Oh, Beautiful Virgin
New video
Hello Dolly
Tucker Carlson says Boris Johnson wants "a million dollars, in Bitcoin or cash, from Tucker Carlson to talk about Ukraine.
for KING & COUNTRY - Amen (Reborn) [feat. Lecrae & The WRLDFMS Tony Wi
Russia is rebuilding capacity to destabilize European countries, new UK report warns
Bob Marley - Get Up Stand Up
EU Commission wants anti-drone defenses at Brussels HQ
Yes He Can
Von der Leyen’s 2nd-term pitch: More military might, less climate talk
What A Friend We Have In Jesus
Global Law Enforcement Dismantles Lockbit Ransomware Operation
Unforgettable
Prince William Urges End to Gaza Conflict
Touch The Hem Of His Garment
UK court to hear Assange's final appeal against extradition to the US, where he faces charges related to his journalistic work—the publication of a classified video in 2010 that exposed US war crimes against humanity.
The Lord's Prayer
About 50-60% kids either chose to be YouTuber or influencer
THE GOD MOVEMENT...BEAUTIFUL BVI
A viral video of Nationals MP Barnaby Joyce lying on a Canberra footpath is celebrated by his media mates.
Siyahamba
European Countries React to Navalny's Death by Summoning Russian Diplomats
Ray Charles And The Voices Of Jubilaton, Oh, Happy Day
Israel has gone ‘beyond self-defence’ in Gaza, says Labour’s Streeting
Ramblin' Rose
English farmers to be offered ‘largest ever’ grant scheme amid food security concerns
Protoje - Who Knows ft. Chronixx
Cameron government knew Post Office ditched Horizon IT investigation
Pressure - Virgin Islands Nice
EU Calls for Immediate Ceasefire in Gaza Conflict
Phil Wickham - House Of The Lord
EU Vows To Hold Putin "Accountable" After Meeting Alexei Navalny's Wife
My God Is Real (Yes, God Is Real)
EU Launches Probe Into TikTok Over Child Protection Under Digital Content Law
The Lion King Circle of Life by LEBO M. — LIVE at the HAVASI Symphonic
The EU Initiates Naval Mission to Defend Red Sea Trade Routes
Louis Armstrong - When The Saints Go Marching In
EU and UK Announce Joint Effort on Migration
Kanye West Sunday Service - hallelujah, salvation, and glory
Brazil's Lula Likens Gaza Operation to Holocaust, Israel Says "Red Line" Crossed
Jonathan Nelson - I Believe (Island Medley
Ministers Confirm Proposal to Prohibit Mobile Phone Usage in English Schools
From The Virgin Islands Sqad Up
Microsoft-backed OpenAI valued at $80bn after company completes deal
Common, John Legend - Glory
‘Alexei would want to tell Russia not to give up fighting’
Anthony Evans vs. Jesse Campbell - If I Ain't Got You
Rwandan Footballer's Dismissal Sparks Concerns Over UK Asylum Plan
I have a dream, MLK inspiring speech
Whisky Challenges China's Baijiu Market During New Year Celebrations
Aretha Franklin, Marvis Staples - Oh Happy Day
Avdiivka - Symbol Of Ukrainian Resistance Now In Control Of Russian Troops
BVI Freedom Song
Putin Critic Alexei Navalny's "Killers" Refusing To Hand Over Body, Say Allies
Billy Preston - You Can't Beat God Giving (Live)
"Historic Step": Zelensky Signs Security Pact With Germany
VIRGIN ISLANDS REGGAE CARIBBEAN RIDDIMZ
"Historic Step": Zelensky Signs Security Pact With Germany
Oh Happy Day Edwin Hawkins - Anthony Brown w FBCG Combined Choir
20 Tech Giants Sign Effort To Fight AI Election Interference Across Globe
'Stand by Me' performed by Karen Gibson and The Kingdom Choir
Joe Biden Accuses Putin of Causing Navalny's Death
National Anthem of the British Virgin Islands - Oh, Beautiful Virgin
Russian opposition leader Alexey Navalny has died at the Arctic prison colony
Hello Dolly
Tucker Carlson grocery shopping in Russia. This is so interesting.
for KING & COUNTRY - Amen (Reborn) [feat. Lecrae & The WRLDFMS Tony Wi
Julian Assange's Wife Warns of His Death if Extradited to US
Bob Marley - Get Up Stand Up
‘A lot higher than we expected’: Russian arms production worries Europe’s war planners
Yes He Can
Greece Legalizes Same-Sex Marriage and Adoption Rights
What A Friend We Have In Jesus
Hungarian Foreign Minister: Europeans will lose Europe, the Union's policy must change drastically
Unforgettable
In Britain Homeowners are receiving CPO’s (Compulsory Purchase Orders) so their homes can be redistributed to migrants
Touch The Hem Of His Garment
Microsoft says it caught hackers from China, Russia and Iran using its AI tools
The Lord's Prayer
Influencers Exploit X Platform for Profit Amidst Israel-Gaza Conflict
THE GOD MOVEMENT...BEAUTIFUL BVI
Former Dutch PM And Wife Die "Together Hand In Hand" Via Duo Euthanasia
Siyahamba
Media Giant Paramount Global, Which Owns CBS News, To Cut 800 Jobs
Ray Charles And The Voices Of Jubilaton, Oh, Happy Day
×