12 Jun 2022 • 2 mins to read
The U.S. Bureau of Labor Statistics recently shared some peculiar facts on the country's rise in Energy Inflation. According to its findings, Energy Inflation in the United States accelerated to 34.6% last month alone, the most since September of 2005. With the largest gasoline (48.7%) and fuel oil (106.7%) inflation increase in history, the impact on small- and medium-sized businesses was the most detrimental.
Behind the disturbing fluctuation are two major factors affecting the supply of key commodities – supply-chain disruptions caused by the Covid-19 outbreak and Russia's invasion of Ukraine, which created a shortage of essential goods worldwide.
Despite the fact that the government allocated trillions of dollars to help businesses keep afloat, there's no visible end to the rise of the Energy Inflation that will apparently continue affecting enterprises nationwide.
The unfolding Energy Crisis had a substantial impact on households as well. Families countrywide spend nearly 2 times more to fill their gas tanks. The cost of energy, therefore, becomes nothing less than unaffordable.
As more Americans brace themselves for the upcoming energetic catastrophe, they minimize their energy spending to the historic lows – from 6% of their disposable income in the 1960s to around 3% as of June 2022.
Energy Inflation is particularly painful for small- and medium-sized businesses. Hence, around 75% of small business owners claim that the rising energy prices affect them in a bad way.
Nearly 90% of those also add that the Energy Inflation hurts their hiring capabilities, forcing them to raise their prices for the end consumers. Overall, almost 60% of small business owners report that the economy is much worse than it used to be just a few months ago, in January 2022.
Retaining the workforce is now even more challenging for businesses nationwide, as nearly 70% of those were forced to increase wages to retain their staff. This affected the end consumer because the prices for offered goods and services skyrocketed to fill in the budgetary gaps created by wage increases.
On top of it all, as energy prices continue to rise, businesses lack predictability and are looking for better ways to safeguard their enterprises from the impending energy crisis.
The cost of energy is driving inflation. Since energy prices account for around 1/3 of the Consumer Price increases and global events, such as Covid-19 and the war in Ukraine, accelerate these processes, businesses are looking to secure their peace of mind by signing affordable energy contracts and scoring fixed energy rates asap.
Mitigating the impacts of inflationary shocks is an ongoing process, but if your business is looking for an immediate solution, Enerrgy5 is there to help you out.
With Energy5, your business can secure cheap and highly predictable fixed energy rates, which will give you, as a business owner, the peace of mind you deserve!