TERRE HAUTE/BRAZIL, Ind. (WTWO/WAWV) — With prices skyrocketing for everything from food to fuel, some local residents are trying to figure out how to make their paychecks go farther.
“It’s starting to scare me,” Brazil resident Britany Phillippo said. “Like what are we going to do if everything keeps rising.”
Phillippo and her family live in Brazil. She said her and her husband used to have money to put away between paychecks, but that’s not the case anymore.
“He said he put $80 in this to fill the van up that used to maybe take $30, $35, $40 to fill up,” she said. “It’s doubled.”
Phillippo said just over the course of the past few weeks, her family has been forced to make some significant life changes.
“We’ve stopped eating out as much, we’ve stopped any unnecessary purchases, like it’s strictly anything that we need,” Phillippo said.
Robert Guell, economics professor at Indiana State University, said the increase in price for oil will trickle down into almost everything we buy.
“An oil or energy crisis kind of environment is on the supply side, so it’s going to make it that much more expensive for farmers to plant because they’re going to be buying 6 and 7 dollar a gallon diesel for their farm equipment so food down the line is going to be more expensive,” Guell said.
Guell put this into the relation of the consumer price index, which he said is used to figure out what an average person buys and how much they pay.
“The things that are energy sensitive in that realm are transportation which is about 7.5% of the typical person’s budget,” Guell said.
He said that 7.5% includes the leasing price of a vehicle and the cost of gas.
“If that were all it was, that would be one thing. But energy contributes madly to the other things in the CPI like food,” Guell said.
Guell said food is 14.5% of an average person’s budget according to the CPI, but it does not stop there.
“Obviously we heat our homes, we cool our homes, power our homes, so that goes into the 40% that is our housing,” Guell said. “So, energy is all throughout.”
This can mean an increase in just about every aspect of life for a mother of two such as Phillippo.
“Doctors appointments, getting to work, childcare, food, formula, everything has just raised dramatically, even diapers,” Phillippo said.
Guell said consumers haven’t seen these economic conditions in decades.
“We are at sort of a double whammy of having demand side and supply side forces on inflation at the same time and that hasn’t happened in a very long time,” Guell said. “Probably the late 1970’s.”