Kent State University students adjust to rising economy, inflation costs

Chloe Robertson, Reporter

Kent State University students are adjusting to the increased inflation rates and economic status of the U.S.

Across the country, prices for gas and food continue to increase and college tuition has reached an all-time high during this century.

Kent State professor of economics and Chair of the Department of Economics Michael Ellis said the main contributors to inflation are results of components outside the country.

“External factors, and things such as the Ukrainian war, is pushing up the price of energy supplies, natural gas, petroleum and so forth,” said Ellis.

The U.S. Labor Department’s Bureau of Labor Statistics (BSL) recently reported calculations of the Consumer Price Index (CPI), which show an 8.3 percent increase of inflation on all items in the United States since the end of August.

Sophomore journalism major Genna Sobiech discusses her recent struggles with current inflation rates. “Increase in gas prices has not been the easiest, so now I just carpool with other people if I can,” said Sobiech.

Sobiech lives off-campus this year and is learning to live on her own instead of in a dorm with a meal plan.

“(Living independently) has taught me a lot about finances and budgeting and things like that, I’m mindful of what I’m buying,” said Sobiech. “Literally everything is just expensive,” said Sobiech. “If I spend more money one week then I have to spend less the next week,” Sobiech added.

High inflation raises the cost of student necessities such as housing, food, transportation and tuition rates. Last year, Sobiech worked part-time but is currently unemployed this school year in order to balance her course work and personal life.

“I just have to be smart and knowledgeable about what I’m spending because I never know what the economy is gonna be like,” Sobiech said.

Inflation is measured by the overall increase in prices and cost of living in a country. If inflation is low and predictable, it is easier to capture it in price-adjustment contracts and interest rates, reducing its distortionary impact.

“The recent surge and inflation has been in the news a lot. And aside from just driving up the cost of living, it’s causing a reaction from the Federal Reserve to increase interest rates to try to depress spending and push inflation back down,” Ellis said.

Ellis explains how there is not an exact science to lowering inflation rates. The Federal Reserve proceeds with trial and error until they achieve success.

“Inflation will continue to be very high. Of course, what they (Federal Reserve) want to do is to just slow the economy just enough to moderate inflation, and get it back down to an acceptable level,” Ellis said.

From the beginning of the year to the end of August, the price of gasoline increased 25.6 percent and the price of food increased 11.4 percent. The average price of healthcare rose 5.4 percent and college tuition fees increased 2.8 percent in the past year.

“Basically, anything that stimulates people’s spending tends to push inflation up,” said Ellis.

“The problem is the Federal Reserve can raise interest rates as much as they want to get inflation down, but it’s not an exact science, so they can very easily go overboard and crush the economy,” Ellis said. “The Federal Reserve could depress overall spending sufficiently to keep inflation under control. But of course, the question is can they do it without hurting the economy,” Ellis added.

The Education Data Initiative reports the cost of college has increased 196 percent during the 21st century.

When asked about the impact of inflation on students Ellis said, “the more inflation stays high, it’s eroding the purchasing power of students and makes it more difficult for them to make ends meet and to pay their tuition.”

“Inflation can certainly create an environment where it’s difficult for students to continue their studies,” Ellis added.

Inflation is the measure of the rate at which prices are rising. However the increase in prices is not linear. Prices are rising at different rates, some falling and others rising. Inflation rates are calculated by the average overall increase in prices, those prices are then calculated into a percentage.

Liam O’Brien is a full-time Kent State PhD student as well as a part-time instructor for Kent undergraduates. By working for Kent State, O’Brien’s final two years of tuition are being waived. However, he is a recipient of student loans and understands the weight of student loan debt.

When discussing the recent state of the economy O’Brien said, “there’s a growing inequality of income and less economic democracy as individuals, as a society and in the workplace.”

“It affects our buying power as students and we are at the whim of whatever the market wants for us,” said O’Brien. “When staples like food or gas get more expensive, that has a very adverse effect on us,” said O’Brien.

College tuition inflation averaged 4.36 percent from 2010 to 2020. The cost of going to college has risen almost five times the rate of inflation over the past 50 years.

O’Brien said students are feeling “economically insecure,” forcing students to focus on how much money they plan to make in the future, instead of being “masters of their own destiny.”

“Economy affects what students choose to learn. Deeply personal decisions are not being made for the purpose of interest, they’re being made to get money,” O’Brien said.

“We should build the economy for things like full employment, education for those who want it and keeping unemployment and inflation at bay,” O’Brien said.

Chloe Robertson is a reporter. Contact her at [email protected].