Wage Push Inflation

Inflation: it’s inevitable. Prices rise, wages rise, and prices rise again. Wage push inflation refers to the rise in the cost of goods as a result from a rise in wages within a company.

When a company gives raises to its workers (increasing the overall size of the pie of money going into workers' pockets), that money’s gotta come from somewhere. In order to cover the costs of raises, companies oftentimes raise the prices of their products and services...a phenomenon called wage push inflation.

When push comes to shove (like when the minimum wage is raised, or companies are competing for talent), wages go up, pushing up prices. And the merry-go-round of inflation goes 'round and 'round...