Inflation in Seatte Among Nation's Highest

Despite withering economic performance and declining housing prices, the Seattle area has one of the highest, if not the highest rates of inflation among major metropolitan areas. The Bureau of Labor Statistics (BLS) reports that as of June, Seattle's 5.8% annualized inflation rate was tops among 10 major metro areas it looked at. A different study by Economy.com, utilized BLS and other economic data and reported that Seattle's inflation rate was the highest among the nation's 40 largest metro areas.

Some "blame" goes to our better than average job market performance (3.9% locally, vs. 5.5% for the whole state and 5.7% nationally). Probably the biggest factor though are rental rates that continue to rise, despite the weak housing market (which is still stronger that in most of the rest of the country) and gasoline costs that are also up more here than in most parts of the country.

So, because of our higher cost of living, does that mean that pay increases and wage rates will follow suit and increase more quickly? Probably not. Despite the higher inflation rates, poor and weakening business conditions, along with a weak overall labor market (except for tech, healthcare and a few other pockets) is not a recipe for higher merit budgets.

Let's call it "Seattle Stagflation." High inflation and poor economic growth is a bad combination for everyone; businesses, wage earners, renters, drivers, etc.