The 477 price checkers that determine inflation

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READING, Pa.—Emily Mascitis holds one of the most important jobs you never knew existed.

As Americans’ monthly bills climb at the fastest rate in four decades, it’s Ms. Mascitis’ work that confirms that the $9 you just paid for a 4-pound bag of clementines is no anomaly.

Ms. Mascitis is a field economist with the Bureau of Labor Statistics, one of 477 people employed by the federal government to track the prices of hundreds of thousands of goods and services each month. The culmination of their work is the Consumer Price Index, which moves markets and monetary policy and charts changes in the cost of living for millions of people.

The current run of inflation has put pressure on government price monitors and the economic indicator they produce; many have recently returned to in-person stores and businesses after a two-year stint working from home. April CPI data will be released on May 11.

A typical day at work might take Ms. Mascitis to a beauty salon to check the price of a blowout, to a jeweler to see what a strand of pearls cost, and to a funeral home to find out what it charges for services. of cremation. It also gives him a front-line view of how broad economic forces ripple out into the real world.

Before the pandemic and before the rise in inflation, store managers, as well as Ms. Mascitis’ family and friends, did not take much interest in the numbers she collected.

Now, she says, a trip to the grocery store or the mechanic can take 10 minutes longer as business owners complain to her about rising prices. Her husband turns to her for help with the cost of food and clothing for their household of 10. (Ms. Mascitis, mother of six, tries to curb the family obsession with the clementine: “We need to pick a cheaper fruit.”) Her friends ask for the scoop on the upcoming BLS reading – something she can’t. not disclose. under any circumstances because confidentiality is one of the fundamental elements of the job of a field economist.

Ms. Mascitis checks prices at an auto repair shop in Philadelphia.


Photo:

Rachel Wolfe/The Wall Street Journal

Ms Mascitis, 50, who has worked as a BLS price checker since 2013, describes her job as “a treasure hunt”.

She set off one day last month with a list of items to assess queued on a government-issued tablet. First stop: A locally-owned auto repair shop in an up-and-coming Philadelphia neighborhood, where she must record the full cost of a job on the rear brakes, wheel bearing shell assembly replacement and the complete replacement of the brakes.

The mechanic waits for him and tells him about the rising costs of running the shop, rent and labor over the price of parts. He says he will have to move his office to a less expensive part of town. Freon for air conditioning systems has tripled in price, according to its supplier. He says some customers are slow to repair their car and instead use public transport due to high repair costs.

“It’s a mess,” admits Ms. Mascitis.

After 10 minutes, the mechanic calls his parts supplier for the latest material costs.

“And is the sales tax on materials and labor still 8%?” asks Mrs. Mastitis. Yes, the mechanic confirms.

Participation in the IPC is voluntary for businesses, so having a connection with individual business owners helps, says Mascitis. As branch manager, she helps recruit new small businesses as well as corporations to be part of the index. She also supervises 10 employees.

The work of a price checker is demanding. To price an item, workers sift through a list of data points up to 11 pages long to ensure they are pricing the same item as the previous month. A can of soup has 12 different specifications, including flavor, size, brand, organic labeling, packaging material, and dietary characteristics, such as sodium content.

Maureen Greene, deputy regional commissioner of the Bureau of Labor Statistics, says price monitors have very strict data collection rules.


Photo:

Rachel Wolfe/The Wall Street Journal

Price checkers aren’t looking for ‘madness,’ says Maureen Greene, assistant regional commissioner who oversees the Philadelphia area price programs division for the BLS, adding that workers are trained to stay on the job. , whatever happens.

“If I was in a store trying to price my cans of peas and they were handing out gold bars in the next aisle, I would still be focused on pricing my cans of peas,” says- she.

At a grocery store outside Reading, Pennsylvania, Ms. Mascitis introduces herself to the night manager and heads to the soup aisle to buy a box of chicken noodles. She double checks to make sure this is the exact item she is supposed to save. Otherwise, it could distort the accuracy of the full index or render its data point unusable.

“Do you see what I just did? I almost ruined everything,” she says, pointing to a tiny “low sodium” label on the box.

Next, Mrs. Mascitis heads to the frozen food aisle, looking for a noodle dinner. After rummaging through the freezer, she decides to ask the manager if it’s out of stock and says she’ll be back.

Supply chain shortages have made it more difficult to check prices from month to month during the pandemic, as goods are often out of stock, Ms Mascitis says. During the visit, an ad on the grocery store’s AP asked shoppers to be patient as the store is dealing with a limited supply.

Crouching down to price a bag of potato chips, Ms. Mascitis notices a trend she’s seen often lately: shrinkage. The price of chips remained the same but the contents of the bag decreased from 12 to 11 oz.

Ms. Mascitis walks the aisles of a grocery store.


Photo:

Rachel Wolfe/The Wall Street Journal

“It’s called shrinkage, and it’s sneaky because the consumer doesn’t always realize it,” says Mascitis.

The BLS tracks the prices of up to 100,000 goods and services and 8,000 homes each month. The agency decides which items to rate using data collected by the census on shopping habits, making sure the metrics reflect how Americans spend their money, and rotating items after four years.

“We have very strict data collection rules. Someone who runs a store is not trained in CPI’s data collection rules,” says Ms. Greene, who oversees Ms. Mascitis and 65 price checkers in a region that includes New Jersey, Pennsylvania, Delaware, Maryland, Washington, DC, Virginia and West Virginia. She adds that it would be a burden on stores to expect them to do what CPI does. “They would say it’s good enough, and good enough isn’t usually good enough for us.”

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First hired as a price checker during the inflationary boom of 1978, Ms Greene says she traveled with a car trunk full of binders containing checklists for pricing each item on the CPI list, as well as guides for substitutions. Once completed, she sent the lists to BLS headquarters in Washington, DC. They took up an entire conference room in the office before they were dispatched.

Some of the part-time BLS employees, who earn between $18.91 and $30.44 an hour, have been on the job for decades. After taking time off from work to raise her daughter, Casey Wensel, 63, was looking 16 years ago for a part-time job where she wouldn’t spend her days at a desk.

She was disappointed that the pandemic had done just that. For the past two years, price checkers like Ms. Wensel have relied primarily on company websites, supplemented by calls. Many companies, she says, don’t pick up.

Other challenges related to the pandemic are addressed during new training sessions. This includes how to find phone numbers and email addresses of places they could just drop in, and how to rate online items they might know nothing about.

“We had to teach a lesson on identifying different styles of bras,” Ms Mascitis says, adding that vegetarians sometimes struggle with pricing meat. “Almost everyone is going to have things they really learn from working for CPI,” says Ms. Greene.

Airlines, gas stations and retailers use complex algorithms to adjust their prices based on cost, demand and competition. WSJ’s Charity Scott explains what dynamic pricing is and why companies are using it more often. Illustration: Adele Morgan

Write to Rachel Wolfe at [email protected]

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