COMP NEWS – A new study on “Greedflation” gives further credence to the notion that corporate profiteering contributed significantly to driving up inflation during 2022.
A joint study by think tanks IPPR and Common Wealth found profiteering by some of the world’s biggest companies forced prices up significantly higher than costs during 2022.
Inflation soared across the globe last year, peaking near 11% in the eurozone and above 9% in the U.S.
The source of that high inflation has become a well-trodden line. Analysts have typically laid the blame on supply-chain bottlenecks created by excess demand during the COVID-19 pandemic and exacerbated by Russia’s invasion of Ukraine.
The war also increased energy prices, leading to further rises in inflation as suppliers factored in higher transport and running costs.
While this obviously contributed to rising prices, the report finds that company profits increased at a much faster rate than costs did, in a process often dubbed “greedflation.”
Profits for companies in some of the world’s largest economies rose by 30% between 2019 and 2022, significantly outpacing inflation, according to the group’s research of 1,350 firms across the U.S., the U.K., Europe, Brazil, and South Africa.
The source of inflationary woes in recent years has been hotly debated, with many still pointing towards supply-chain bottlenecks brought on by COVID-19 and international wars.
Inflation soared across the globe last year, peaking near 11% in the eurozone and above 9% in the U.S.
The source of that high inflation has become a well-trodden line. Analysts have typically laid the blame on supply-chain bottlenecks created by excess demand during the COVID-19 pandemic and exacerbated by Russia’s invasion of Ukraine.
The war also increased energy prices, leading to further rises in inflation as suppliers factored in higher transport and running costs.
While this obviously contributed to rising prices, the report finds that company profits increased at a much faster rate than costs did, in a process often dubbed “greedflation.”
Profits for companies in some of the world’s largest economies rose by 30% between 2019 and 2022, significantly outpacing inflation, according to the group’s research of 1,350 firms across the U.S., the U.K., Europe, Brazil, and South Africa.
To read more about greedflation and its effects on compensation and the economy, click here.
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